Customers of First Bank of Nigeria won’t be able to make foreign purchases with their cards starting on Friday, September 30, 2022. The commercial banks in Nigeria have been reevaluating their international transaction thresholds since February, and several of them are no longer allowing transactions beyond $20.
This is a response to what the Central Bank of Nigeria is doing to help the naira.
From Friday, September 30, 2022, First Bank of Nigeria customers won’t be able to use their naira-denominated cards to make foreign purchases. According to the report on the mail received by the customers from the bank about the change, it reads that the Naira Mastercard, Naira Credit Card, our Virtual Card, and Visa Prepaid Naira Card are no longer usable for international transactions due to the current foreign exchange market realities. On September 30, 2022, this will come into effect.
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For overseas transactions up to $10,000, clients are told to use the bank’s Visa Debit Multicurrency card, Visa Prepaid (USD) card, or Visa Gold Credit card.
The fact that the former are issued in naira, and the latter in dollars allows for a straightforward distinction between the two types of cards. A dollar equivalent would be taken from your naira account based on the currency rate in effect at the time of purchase. For instance, if you wanted to use your naira card to pay for a Logitech Gaming headset from Amazon,
But if you used a dollar card, the exchange rate at the time of the transaction would not apply because you already have the dollar in your account. You might need to purchase dollars through forex brokers or other vendors to fill your domiciliary account.
Should other banks follow suit with First Bank?
The Nigerian economy continues to struggle with a lack of foreign currency, and the move by First Bank to block transactions on its naira cards is the most recent development. Because there isn’t enough foreign currency, many banks in the country have rethought their FX policies.
The Central Bank Of Nigeria Unveils USSD Code For eNaira Transactions
Some banks in Nigeria recently decreased clients’ spending on overseas transactions made with their naira cards to $20. In February 2022, the United Bank for Africa (UBA) gave consumers the first piece of information, announcing a $20 cap on overseas transactions. In the ensuing period, Zenith Bank, Guaranty Trust Bank, Sterling Bank, and Union Bank made the same move.
The frequency with which certain banks allow customers to use this money has decreased, which has hurt requests for personal travel allowance (PTA) and business travel allowance (BTA).