Forex scarcity bites harder as Naira debit cards lose international transaction rights

This is due to the worsening case of forex scarcity which has continued to create panic within the country's financial sector.

Before it got to this stage, the financial institutions had earlier announced that they will be reducing their monthly international spending limit on naira cards.

The announcement which was made in March noted that the spending limit would be reduced from $100 to either $20 or $50 a month.

This announcement clearly revealed the distressed position of these banks in securing forex, a development which has also recently hit other sectors of the economy like the Aviation industry.

The forex scarcity has been linked to Nigeria’s depleting external reserves as data obtained from the Central Bank of Nigeria (CBN) has shown that in H1 2022, Nigeria’s external reserves dropped from $40.52 billion at the start of the year, to $39.16bn as of June 30, 2022.

This drop indicated a 3.37% depreciation despite the recent spike in global energy prices.

The external reserve further took a nosedive as it fell from $39.219 billion at the end of July 2022 to $38.882 billion as of August 11, 2022.

According to First Bank, customers have been advised to use alternative dollar cards as it has confirmed international transactions will be stopped on all Naira cards from September 30.

Standard Chartered Bank had also set theirs in motion already as the date of implementation was fixed for August 1, 2022.

For other banks who have not started the implementation of the suspension, the dates would definitely be announced soonest as the policy is set to take place in all the financial institutions as long as the scarcity persists.