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Banks Suspend ATM Card Usage Abroad Over Dollar Scarcity

Deposit money Banks have begun suspending their automatic teller Machine (ATM) cards (debit and credit) from working overseas as dollar insufficiency continues to hit the economy badly.

Stanbic IBTC Bank, standard chartered Bank Nigeria and Guaranty Trust Bank on Friday announced the suspension of their overseas ATM card services.

Also suspended by the banks are online transactions priced in foreign currencies. This implies that customers of the banks will not be able to use their credit or debit cards to make online transactions that are denominated in Euros, dollars, pounds sterling and other foreign currencies.

In a note to its customers on Friday entitled: ‘Suspension of international transactions on naira debit cards’, standard chartered Bank Nigeria said, “Please be informed that effective now, your naira denominated debit cards will not be functional for international transactions.

“This is because of the current volatility in the foreign exchange market. Your naira-denominated debit cards can only be used for local transactions at point of Sale terminals, ATM Machines and on-line for Nigerian retailers.”

In a text message to its customers on Friday, Stanbic IBTC Bank similarly said, “Dear customer, kindly note that effective October 18, 2016, your ability to carry out transactions priced in foreign currency using our naira credit and debit cards will be suspended. We apologise for any inconvenience in this regard.”

Both standard chartered Bank and Stanbic IBTC Bank Nigeria advised customers seeking to carry out transactions denominated in FOREX to apply for dollar or pounds sterling debit credit cards. According to them, the dollar or pounds sterling debit or credit cards will be linked to the customers’ domiciliary accounts.

GTBank also announced the suspension of the ATM cash withdrawal service abroad. The lender also slashed its monthly ATM transactions to $100.

In a notice to customers on Friday entitled: ‘Review of the international spending limit on your naira Master Card’, the bank stated, “We write to inform you of the monthly spending limits currently applicable when using your GTBank naira Master Card for international payments through PoS and on-line. Previous monthly limit through PoS and on-line was $250; the new monthly limit through PoS and on-line is now $100. Kindly, note that ATM cash withdrawal on your naira MasterCard is now only accessible in Nigeria.”

The development will make students studying in the UK, U.S, Canada, Ukraine and other parts of the world to face more challenges getting their monthly stipends from their parents or sponsors..

Most of the students had relied on the ATM card withdrawal to get their monthly allowances from their parents before now.

This means customers seeking to do transactions abroad will have to open domiciliary accounts and fund same with dollars, Euros, pounds purchased from the parallel market at the current exchange rates.

Although other banks have yet to announce the suspension of ATM card services abroad, findings by punch correspondent showed that many lenders had reduced drastically the amount that customers could withdraw via ATMs abroad.

This is despite the fact that the banks have in the past few months reduced the monthly total amount of FOREX-denominated transactions that customers can do, using their naira debit or credit cards via ATMs and PoS terminals abroad as well as on-line payments or transactions.

As of last week, findings showed that some banks had reduced their daily ATM withdrawal limit abroad from the $300 advised by the central bank of Nigeria’s Bankers Committee to $100, 00 due to their inability to source for dollars to fund the transactions.

Unconfirmed sources said some banks had reduced their monthly ATM withdrawal limit abroad to $100, 00.

Top banking officials close to the development told PUNCH correspondent under the condition of anonymity that banks were increasingly finding it tough to fund their foreign-currency denominated services, especially on-line FOREX transactions and overseas ATM withdrawals, as well as PoS usage overseas by customers.

A top official of Deposit money Bank, who spoke on the condition of anonymity, told PUNCH correspondent on Sunday, “We have to stop the services. Formerly, we were sourcing at high prices and we were selling same to customers at similarly high prices. But the situation is now tense; the dollar scarcity has assumed a new dimension.

“This is coupled with the fact that some bank customers are using the platforms to do round-tripping. it is time we stopped it.”

The decision by some banks to suspend overseas ATM card services and on-line FOREX transactions came barely a week after the CBN, through the Bankers’ Committee, raised concerns about what it called the indiscriminate and suspicious manner in which some bank customers were spending dollars and other foreign currencies abroad through their naira debit cards.

Thus, the regulator said it had concluded that bank customers who spent higher than the $50,000.00 annual FOREX limit it imposed would be barred from the nation’s FOREX market.

Mrs. Tokunbo Martins, the Director, Banking supervision CBN stated this after the 329th Bankers’ committee meeting held at the central bank’s office in Lagos on Wednesday.

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