Posted on: 10:27 Sun, 20 Dec 2015



Deposit Money Banks have
commenced a process to stop all
customers from using their payment
cards, popularly known as
Automated Teller Machine cards, for
dollar-denominated transactions
when they travel abroad with effect
from January 1, 2016.

SUNDAY PUNCH’s investigation also
revealed the banks would not allow
their customers to use naira-
denominated ATM cards locally for
transactions denominated in forex.

This means bank customers will not
be able to use their cards to buy
products from foreign e-commerce
sites like e-bay and amazon.com in
which payments are made in forex.
The development follows the
lingering scarcity of foreign
exchange, especially the dollar, to
settle obligations arising from
customers’ use of the ATM cards for
forex-denominated transactions.

Already, Standard Chartered Bank
has notified its customers that from
January 1, 2016, they will not be able
to use their naira-denominated ATM
cards for transactions that are
denominated in foreign currencies,
either locally or when they travel
abroad.

In a notice to its customers, Standard
Chartered said, “This is to notify you
that from January 1, 2016, your
naira card will no longer be enabled
for international use. This is as a
result of the limited foreign exchange
supply in the financial market.”

Asked how long the suspension of
cards from international
transactions would be, the
spokesperson for Standard Chartered
Nigeria, Mrs. Dayo Adurogbo, said,
“We cannot give a definite date. It
depends on how soon it is available.

We will do everything to meet our
customers’ demand once it is
available.”

Further findings showed that a
number of other banks had stopped
customers from using their ATM
cards abroad but had yet to officially
communicate this to them.

Some customers told our
correspondent that when they
notified their banks of plans to
travel and the need to enable their
cards work overseas, they were
simply informed that the cards could
not be enabled for now due to issues
relating to forex scarcity.

SUNDAY PUNCH findings showed
others banks might issue notices
similar to that of Standard Chartered
Bank before the end of the year.

“We had some discussions recently
and some top bank officials said they
would stop customers from using
their naira-denominated cards for
international transactions due to the
serious challenges in getting forex to
settle their international partners,” a
top bank official, who spoke on
condition of anonymity because he
was not authorised to speak on the
matter, said on Friday.

The current situation means
customers travelling abroad for
Christmas and New Year may face
severe payment challenges, a
situation that may mar their
shopping plans.

The fall in prices of crude oil, the
main earner of foreign exchange for
Nigeria, has made the nation’s forex
income to reduce drastically,
creating dollar scarcity crisis for the
Central Bank of Nigeria.

The CBN has been rationing dollar to
banks, importers and other forex
users as the nation’s foreign
exchange reserves continue to
deplete, hitting $29.4bn on
December 7, 2015.

The PUNCH had exclusively reported
on Thursday that banks had cut the
amount that their customers could
spend using their debit and credit
cards abroad by between 70 and 90
per cent. This took effect during the
first week of December for the
majority of the banks.

Specifically, banks cut customers’
card spending in foreign currencies
from the annual $50,000 allowed by
the CBN to between $5,000 and
$15,000.

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.