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Banks stop cash withdrawal from overseas ATMs (See Reason)

by Anjorin Dare
Banks stop cash withdrawal from overseas ATMs (See Reason)

Banks have suspended all cash withdrawals from overseas Automated Teller Machines (ATMs), except for customers whose cards are linked to domiciliary accounts funded locally.

Banks have been encouraging travellers to open and fund dollar accounts, which aside having no spending limits, provide them the flexibility to spend at all times.

Banks stop cash withdrawal from overseas ATMs (See Reason)

Banks stop cash withdrawal from overseas ATMs (See Reason)

The lenders are also raising their card spending limits on Point of Sale (PoS) and online card transactions abroad, an indication of increased dollar liquidity and rising exchange rate stability.

Guaranty Trust Bank (GTBank) and First City Monument Bank (FCMB) at the weekend raised their monthly card spending limit on overseas PoS and online transactions from $1,000 to $3,000 and around $2,000 to $5,000.

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GTBank informed its customers of the increase via email. “We would like to inform you that our monthly spending limit on your GTBank Naira MasterCard has been reviewed to $3,000 from $1,000 for your international online and PoS transactions. Kindly note that international ATM cash withdrawal is still restricted,” it said.

“Clothing, shoes, electronics, books…whatever your needs are FCMB Naira Debit Card gives you instant full access to $5,000 monthly to shop online”, FCMB said in an email sent to its customers at the weekend.

GT Bank had nearly two years ago during the height of the dollar scarcity limited monthly transactions on PoS and online transactions using cards to $100, British Pounds Sterling 90, Euro 130 and Canadian Dollar 360. The prevailing dollar scarcity at that time made it difficult for travellers to pay their hotel bills and make reservations and other transactions using their debit cards.

Many banks which announced the suspension of their overseas ATM card services in October 2016 have all lifted the suspension and raised monthly transaction volumes for customers on foreign currency-denominated deals, including those conducted on PoS machines and online.

The dynamics changed in April last year when the Central Bank of Nigeria (CBN) introduced the Investors’ & Exporters’ (I&E) Forex window which has so far attracted over $53.9 billion to the economy. The dollar inflows have helped to strengthen the naira against the greenback and brought stability to the forex market.

Financial analysts at Afrinvest West Africa said stability in the forex market followed the increased volume of forex interventions and the coming of I&E FX window, which allows for flexibility in pricing of forex as well as efficiency and transparency in allocation.

For instance, in the first half of 2018, transactions in the I&E Forex window stood at $30 billion, surpassing the $23.9 billion total turnover recorded in 2017 and bringing the overall transactions to $53.9 billion. Although the CBN’s participation is estimated at 30 per cent of the transactions in the window, the increased level of participation to some extent underscores the flexibility of the market as well as investors’ preference of the I&E as the platform for Forex deals.

The Nation.

 

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