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Posted by on Saturday October 22, 2016 at 9:9:19:

In the battle to save the Nigerian Naira amidst the falling value of exports from Nigeria and increasing demand for foreign currencies, one of the things which Nigerian banks are doing is placing spending limits on Naira cards.

In the past, Nigerian banks introduced Naira cards which were branded with Visa and MasterCard and were empowered to make payments for local transactions. They were not immediately activated for foreign transactions until later on after they were introduced. So, those Naira Cards were designed for both local and foreign use and hence really helped many Nigerian travellers to make payments when they reach foreign countries. Those who travel with such Naira cards were able to make payments on foreign websites, foreign retail stores and service providers. With the limits being placed on Naira cards, they would not be able to spend as much as they did in the past and I think this will ultimately make Naira Cards unattractive to future Nigerian travellers.

The banks in Nigeria which issued Naira cards also made money since they were able to profit from the fluctuations in the exchange rate system and so Nigerian customers paid a bit of extra money to banks when they use their Naira cards for foreign transactions. However, it appears that the banks are no longer making profit as they used to probably because the Naira has suffered huge losses.

Although many Nigerians who travel with Naira cards will not mind using their Naira cards to make foreign currency payments despite the unfavourable exchange rate and I know that some of them spend as much as $1000 per month. It's a bit laughable to think they will be satisfied with the limits being placed on Naira cards.

I recently read a report about how a bank pa placed a limit of $100 on Naira MasterCard. With such a low limit, I don't think a serious business traveller would go for a Naira card when next he's travelling because it would be insufficient for him to do business or even lodge at a foreign hotel when abroad. He would rather opt for a foreign currency card or carry extra cash when next he's travelling rather than relying on Naira Cards.

Nigerians who travel abroad spend a lot of money and they do things like taking taxis, lodging at a hotel, visiting restaurants, hiring a car, paying for school fees, shopping and so on because they have the money to do those things. The fact that there has been a lot of limits placed on Naira cards will ultimately make most travellers dump them and go for other alternatives that will suit them.

The banks in Nigeria have made a lot of flip flop and inconsistent decisions regarding Naira Cards and it seems like for now, they are only good for people who just want to make payments locally for transactions in Naira.

Even since the banks starting placing limits on Naira cards for foreign use, there has been a lot of complaints by Nigerians abroad who travelled with their Naira cards only to be disappointed that they could hardly withdraw money from ATMs even though they had the funds to do so. For them, it is a disappointing experience and if they had another chance, they would never have travelled with a Naira card and rather go for a Dollar card linked to their domiciliary account.

I think that for now, any serious Nigerian who wants to travel abroad should go fro a Dollar card rather than a Naira card and just fund his domiciliary account with the money he/she intends to use when travelling abroad so that they are no disappointments or limits on them.





Comments:
1
Re: Can Nigerian travellers survive on foreign spending limits? Reply by Ikechukwu Achumba on Saturday October 22, 2016 at 21:9:56:

Good day sir iam allways glad when i recieve you mail thanks Sir yes we Nigerian can survive because the God of all people will show us the way to survive.





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