Nigerian bank customers who are planning to use their payment cards for shopping via Point of Sale terminals in malls and make hard currency withdrawals via Automatic Teller Machines overseas are in for a shock!

Reason: Deposit Money Banks in the country have cut the amount that their customers can spend using their debit and credit cards abroad by between 70 and 90 per cent.

Investigation by our correspondent revealed that from the first week of December, majority of the banks in the country had made drastic cuts to their customers’ card spending in foreign currencies from the annual $50,000 allowed by the Central Bank of Nigeria to between $5,000 and $15,000.

The amount include all spending by Nigerian customers abroad, either through ATM cash withdrawals or purchases made via PoS terminals in shopping malls, and purchases made in Nigeria through online or e-commerce sites but whose payment is denominated in foreign currencies.

The development means that Nigerians planning to travel overseas during this Yuletide season will be limited in their spending, while those who buy products through e-Bay, Amazon.com and other e-commerce sites from within the country will also be limited to a few items.

According to findings by our correspondent, Ecobank Nigeria Plc has reduced its limit from $50,000 to $5,000, with a maximum of $500 monthly and $100 daily expenditure.

Skye Bank Plc, in a notice to its customers via email, also slashed its international card spending limit from $50,000 to $12,000 annually, a maximum of $1,000 monthly and $100 daily.

Wema Bank Plc also slashed spending on its payment cards from $50,000 to $10,000 annually, $1,000 monthly and $100 daily.

Although other banks have yet to confirm their new international card spending limits, findings by our correspondent revealed that the new limits for most of them ranged from $5,000 to $15,000 annually, and $500 to $1,000 monthly.

It was also gathered that many Nigerian banks were owing MasterCard Incorporated and Visa Incorporated several hundreds of millions of dollars in outstanding settlements for international card transactions by their customers due to the scarcity of forex in the country.

It was gathered from reliable banking sources that the CBN could not sell enough dollars to the banks to settle obligations incurred by their customers from the use of Nigerian issued payment cards overseas.

A top bank executive familiar with the development, who spoke to our correspondent on condition of anonymity, explained, “When Nigerian bank customers use their cards overseas, either to withdraw foreign currencies or buy things in malls via the PoS, or buy thing online here in Nigeria but with payment in forex, Visa or MasterCard settles the payment on behalf of the Nigerian banks most times. They later pass the bills to us, which must be paid in dollars.

“But right now, the banks are short of the forex to settle these companies. Some banks are owing several millions of dollars. So, we have got to cut the spending limit on our won to avoid settlement and reputational risks. The debts are mounting.”

The banker added, “We cannot get dollars from the CBN; we have to source for the greenback from the interbank market; even at a high price, it is still scarce. The CBN is rationing dollars because the external reserves are depleting fast. The central bank is giving priority to only mature obligations and Letters of Credit.”

However, the Director of Communications, CBN, Mr. Ibrahim Mu’azu, said, “The CBN is operating within the limit and guidelines. Any bank that have issues should inform the CBN officially.”

But the Head of Corporate Communications, Skye Bank, Mr. Rasheed Bolarinwa, said the cut in the international spending limit of its customers was not unconnected to the scarcity of dollars in the system.

He said, “The cut in international spend as communicated to the customers is not unconnected to the scarcity of dollars to settle international transactions. This development is, however, not peculiar to our bank as other banks have done same,

The Head, e-Banking, Wema Bank, Mr. Dele Adeyinka, who is also the Vice Chairman, Committee of e-Banking Industry Heads, confirmed that almost all the banks in the country had cut their customers’ international spending limits.

He said the development had to do with the need to avoid settlement and reputational risk on the part of the banks, adding that the DMBs had been finding it difficult to meet up with the international card spending habit of their customers.

Visa and MasterCard declined to comment on the banks’indebtedness, saying the matter was a private affair between them and the banks.

http://www.punchng.com/dollar-scarcity-banks-cut-customers-spending-abroad-by-80/ lalasticlala, dominique, Seun

Hmmmmm....

Pls they should find solution to this oh my company is think of?

Chai!!! This dullardinhario's body odour is getting too much


It shall finally come to pass

Hmmm.............. Oyah, I know some people will come here to blame PMB now.

It's for the main time sha!

This is serious, limiting the amount that one can spend is something else

What nonsense is this? So I can't spend my hard earned money?

What is the CBN's aim with all this restriction, I guess its for more patronage of made in Nigeria.

One of the things that the present administration seems to lack is a financial expatriate. It's appearing that the present administration is not managing the economy so well. Our economy does not necessarily have to crash because the price of oil is going down.

Small scale businesses are falling.
On the economy, I'll rate Buhari an 'E'.
The world has evolved from the military regime.
Ultimately a government will be judged and returned by the electorate in a free and fair elections on how well the economy is faring.
The war against corruption is good and noble but it can go side by side with sound financial decisions.

Very soon, people will be worn out of hearing we are recovering monies from the last government if their economic needs are not met.
A warning for the wise.

change??

Omon see gobe

Here we go again. Is this a country or.... ?

missKiffy:
This is serious, limiting the amount that one can spend is something else

sweatlana:
What nonsense is this? So I can't spend my hard earned money?

tempex88:
What is the CBN's aim with all this restriction, I guess its for more patronage of made in Nigeria.

Daslim180:
Hmmm..............

Neduzze5:
Chai!!! This dullardinhario's body odour is getting too much
It shall finally come to pass

Atmmachine:
Hhgf

Adesiji77:

http://www.punchng.com/dollar-scarcity-banks-cut-customers-spending-abroad-by-80/ lalasticlala, dominique, Seun

end time booking space
modified;;
naw dey haff all modified

What a country?

We don enter am.

I'm loving this shenge

Una dey enjoy una change yet?


If GEJ was clueless, THEN Booohari is USELESS!

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xender:
end time booking space

heutyj

Phew.

Seunaj05:
One of the things that the present administration seems to lack is a financial expatriate. It's appearing that the present administration is not managing the economy so well

Here we go again.

This is serious limiting the amount you can spend out of your personal money. Money you have worked for from January to December. Oga oooo. It is well

Its not like I wasn't expecting this. When an illiterate manages a country this cohort suffers. This is CHANGE at its paramount. Change with no flesh air is bullshit.

Okuwa

Folafikemi:
Here we go again. Is this a country or.... ?

You would be surprised that streetlight would be cracked

I know many of us think this is awful news, and it is.

But for a second, it is what Nigeria needs now.

The official rate of the Naira is pegged at N197-N199. Unofficial rate has been falling steadily to about N270 now.

Nigeria sustains the official rate with its dollars, and in simple terms the less money in dollars leaves the economy the softer the hardship we will feel. We can not eliminate the bad undertone of the economy, but we can manage it, and this is how it can be managed.

By the way. It's majorly the upper middle class and the wealthy that travel abroad for vacs and spend. Those in the lower economic brackets that may want to make dollar-denominated spends should push their plans to 6 to 12 months time. It's austerity measures and everyone should be ready to make sacrifices.

Those in the lower middle class and below should rest easy with this news. They should however rise up against plans to hike the electricity tariff by 40%, increase petrol price, introduce tolls on federal roads, reduce minimum wage and several anti-citizen policies. Now is the not the right time to introduce disruptive economic policies.

-Lord

A cap of limit to spend.

See them blaming buhari already......you want to spend your hard earned naira? Go ahead and spend it..... Dont complain about hard earned dollars by the cbn? Were expecting a rosy ride.....16 years of rot isn't washed out in 6 months ........sit and enjoy the ride.