Nigerian Banks Restore International Transactions On Naira Cards After Years Of Suspension.
In a significant boost for Nigerian consumers and businesses, several commercial banks in Nigeria have reinstated international transactions on naira-denominated cards, marking the end of a nearly three-year suspension. The move, announced by major financial institutions including United Bank for Africa (UBA) and Wema Bank, allows customers to once again use their naira cards for global payments, online shopping, and ATM withdrawals abroad. This development is set to enhance financial flexibility and support Nigeria’s growing digital economy.
The decision to resume international transactions comes after a period of foreign exchange (FX) scarcity that began in 2022, prompting many banks to halt such services due to limited dollar availability. Between July 2022 and January 2023, banks such as First Bank, Guaranty Trust Bank (GTBank), and Zenith Bank suspended international transactions on naira cards, citing challenges in sourcing foreign currency. The restrictions significantly impacted Nigerians, particularly those reliant on international platforms like Amazon, Netflix, and Spotify, as well as businesses requiring cross-border payments.
UBA, in a recent statement to customers, highlighted that the restoration of international transactions aligns with its commitment to delivering seamless banking experiences. The bank confirmed that its Premium Naira Cards, including Gold, Platinum, and World variants, are now enabled for global payments, offering customers greater ease and flexibility. Similarly, Wema Bank announced that its Naira Mastercard can now be used for international transactions, with a monthly spending limit of $500 to promote responsible financial management.
Financial experts attribute this development to improved liquidity in Nigeria’s foreign exchange market. Ayokunle Olubunmi, head of financial institutions ratings at Agusto & Co, noted that the moderating premium on parallel market transactions and reduced arbitrage opportunities have supported banks’ decisions to reactivate naira cards for global use. Charles Sanni, CEO of Cowry Treasurers, added that the narrowing gap between official and parallel market exchange rates, coupled with the naira’s appreciation against major currencies, has bolstered confidence in FX management.
The Central Bank of Nigeria (CBN) has also played a pivotal role in this shift. New policies facilitating account openings for non-residents, particularly Nigerians in the diaspora, have led to increased diaspora remittances. Additionally, the CBN’s efforts to clear FX backlogs, improve Nigeria’s credit rating, and introduce a new trading platform have created a more stable financial environment. Rising oil prices due to geopolitical factors and ongoing bank recapitalisation efforts have further strengthened the economic outlook.
This restoration of naira card functionality is expected to significantly benefit Nigerian consumers and small businesses. Shoppers can now seamlessly pay for international subscriptions and purchases, while businesses reliant on global suppliers will face fewer hurdles. However, some banks, such as Wema, have introduced spending caps to mitigate risks of fraud and ensure sustainable use of foreign currency.
The move has been widely welcomed across Nigeria, with many expressing optimism about its impact on the economy. As other banks are expected to follow suit, this development signals a positive step towards financial inclusivity and economic resilience in Africa’s largest economy.
