Two commercial banks in Nigeria have announced the
resumption of international transactions on their naira cards.
In separate announcements to customers, United Bank of
Africa (UBA) and Wema Bank said the service has recommenced on their naira
cards.
The development comes about three years after many banks
suspended international transactions on naira debit cards.
In a recent notice to customers, the UBA said the resumption
aligns with its continued commitment to providing clients with seamless and
enhanced banking experiences.
“In line with our continued commitment to providing you with
seamless and enhanced banking experiences, we are pleased to inform you that
all UBA Premium Naira Cards, including Gold, Platinum, and World variants are
now enabled for international transactions,” the statement reads.
“This means you can now use your Premium Naira Card for
everyday payments, online shopping, POS, and ATM transactions across the world,
with more ease and flexibility.
“If you haven’t used your card recently, now’s a great time
to rediscover the convenience and prestige that comes with being a UBA premium
cardholder.”
Also announcing the development in a recent statement, Wema
Bank said customers can now “pay in dollars” with their naira cards.
“Your Wema Naira Mastercard just went global! Now you can
pay in dollars on all your favourite international platforms; Amazon, eBay,
AliExpress? Netflix, Spotify, YouTube,” the bank said.
WHY BANKS ARE MAKING THE SHIFT
Ayokunle Olubunmi, head of financial institutions ratings at
Agusto & Co, said the improved liquidity in the foreign exchange (FX)
market supported banks’ decision to reactivate their naira crads for global
transactions.
“The moderating premium on the parallel market transactions
and the reduced arbitrage opportunities is also responsible for the decision,”
he said.
Also speaking with TheCable, Charles Sanni, the chief
executive officer (CEO) of Cowry Treasurers, said the spread or margin between
official and parallel market rates, which have thinned out, may have influenced
the decision by the banks.
He said the interest rate is very high in Nigeria, hence
minimising borrowing money to speculate on foreign exchange.
“The naira has also continued to appreciate against the
other major currencies of the world. More so, there has been increased diaspora
remittances based on the new policy of the Central Bank of Nigeria (CBN) on
opening of accounts for non-residents, particularly Nigerians in diaspora,” he
said.
Sanni also cited the restored confidence in FX management by
the federal government and the CBN, following the ease of transferring funds
and capital repatriation.
The CEO said there has been an improved credit rating of
Nigeria, clearance of the FX backlogs, “new trading platform, increase in oil
prices from geopolitical conflicts, and banks capitalisation”.
Between July 2022 and January 2023, several other banks also
temporarily suspended international transactions on ATMs and POS channels.
The shift was a result of the chronic FX scarcity, which
threatened the survival of key sectors of the economy.
In July, Standard Chartered Bank suspended international transactions
on its naira visa debit card.
First Bank of Nigeria (FBN), on September 21, 2022, said it
will suspend international transactions on its naira Mastercard.
Three months later, Guaranty Trust Bank (GTBank) stopped
global payments on its naira Mastercard, with Zenith Bank joining the fray on
January 9, 2023.
Flutterwave, Eversend, and other financial technology platforms also made similar moves, suspending their virtual card services for international transactions.
Click to signup for FREE news updates, latest information and hottest gists everydayAdvertise on NigerianEye.com to reach thousands of our daily users
Not useful, Nigerian have device a cheaper mean of shopping internationally
ReplyDelete