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Friday, July 14, 2017

Nigerian Commercial Banks raise $ Spending Limit

In the last 24hours, Nigerian commercial banks have raised customers’ International Dollar Spending Limit on overseas Point of Sale (PoS) and online card transactions by 900%. 

The policy shift is expected to help travellers pay their hotel bills, make reservations and other transactions using their debit cards. The decision to increase the spending limit followed improved dollar liquidity in the market triggered by the Central Bank of Nigeria (CBN)-sustained interventions. The interventions have yielded results and reduced foreign currency pressure on many lenders. Some of the funds have helped banks meet retail demand for Personal Travel Allowances (PTA), Business Travel Allowances (BTA), medical needs and school fees payment abroad.

In a report to customers titled: Upward Review of the International Spending Limit on Your Naira MasterCard’ GTBank for example, raised monthly dollar spending limit on naira MasterCard from $100 to $1,000 representing 900%. The bank said: “We write to inform you of the monthly spending limits currently applicable when using your GTBank Naira MasterCard for International payments”.
A POS terminal
The bank said customers could access the fund through Point of Sale (POS) and other online channels. The bank however, said international cash withdrawal was still restricted.

Stanbic IBTC Bank, United Bank for Africa, Access Bank, Stanbic IBTC Bank, Standard Chartered Bank Nigeria (StanChart) and GTBank in October 2016, announced the suspension of their overseas Automated Teller Machine card services. Also suspended by the banks were all foreign currency-denominated transactions, including those conducted on PoS machines and online.

The Naira was then exchanging at N310 to the dollar in the official market and N450 to the dollar in the parallel market. The Naira has since appreciated at both official and parallel markets. It was yesterday exchanging at N306 to dollar in the official market and N368 to the dollar in the parallel market. During the dollar crisis era, many banks encouraged travellers to open dollar accounts, which have no spending limit. Such cards are issued by the banks on domiciliary accounts funded directly by customers. 

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