CENTRAL Bank of Nigeria (CBN) officials have lifted the restrictions on commercial banks allowing their customers to use their debit cards abroad after a compromise solution was reached with the financial houses enabling them to access foreign exchange.  

In December, the CBN issued a directive that barred customers of Nigerian commercial banks from using their credit and debit cards abroad with effect from January 1 this year. It effectively barred customers from using naira-denominated cashpoint cards internationally and locally for transactions denominated in foreign exchange. 

Apart from curtailing shopping abroad, the measure also meant that Nigerian bank customers were 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 foreign exchange. Brought about by the collapse in global oil prices which made foreign exchange scarce, the measure was introduced because banks themselves said they could not get hold of hard currencies. 

However, the move attracted bitter protests from Nigeria's elite who regularly travel abroad and the International Monetary Fund managing director Christine Lagarde, who recently visited Nigeria, said the measure should be temporary. After intense negotiations, the bar has now been lifted and the banks are allowing customers to transfer foreign currency cash deposits made into their domiciliary accounts. 

First Bank of Nigeria spokesman Babatunde Lasaki, said: “Banks can do transfer now. We sent messages to some of our customers yesterday. 

  “We have recommended the transfer of US dollar and other currencies for our customers who make such cash lodgements subject to the monthly limit of $10,000. A flat rate of 2% on the sum to be transferred is to be charged on all the transfers and we implore all branches to re-commence foreign currency transactions for all our customers.” 

A Guaranty Trust Bank spokesman added: “We are pleased to inform you that you can now transfer foreign currency cash deposits made into your GTBank domiciliary accounts via internet banking, mobile app or at any of our branches nationwide, subject to a daily cumulative limit of $10,000.” 

Similarly, Sterling Bank sent an an email to customers on Friday night, saying: “We are pleased to inform you that effective Monday, January 18, 2016 you will be able to transfer cash deposits from your foreign currency domiciliary accounts, up to a maximum of $10,000 per transaction. Kindly visit any of our branches to submit your request as applicable.”

However, Kunle Ezun, a currency strategist at Ecobank Nigeria, said that the CBN would need to come back to the banks and provide a clearer view about what they would do about the cash deposits in their vaults. On August 5, 2015, the CBN had banned the payment of cash into domiciliary accounts in a bid to stop illicit financial flows in the Nigerian banking system.

Mr Ezun added: “With what they have done now, it is now a win-win situation and the banks will be happy to do business as it allows the naira to have a sort of cushion. People can now do wire transfer to and from abroad and it will create a free flow of funds in the market.

“People who have dollars can bring it in now and banks can do transfers for them. With this, the market will calm a bit next week and we expect to some appreciation in the naira in the parallel market.”