Banks resume naira cards’ use abroad as FX improves

…Set spending caps

Several Nigerian Deposit Money Banks (DMBs) have restored the use of naira cards for overseas transactions, setting varying spending limits as the foreign exchange (FX) situation shows signs of improvement.

The banks that have so far reactivated these services include: Providus Bank, First Bank of Nigeria, Guaranty Trust Bank (GTBank), United Bank for Africa (UBA), and Wema Bank.

GTBank has announced a quarterly international spending limit of $1,000 for its Naira card users. The breakdown shows that customers can withdraw up to $500 from ATMs abroad and spend up to $1,000 across online platforms and POS channels within a three-month period.

At First Bank, the international usage limit is set at $500 monthly, with defined transaction frequencies across different channels. According to the bank, cardholders can carry out up to 10 cross-border ATM withdrawals per month, with a charge of N5,000 per withdrawal. They can also perform up to 20 transactions monthly each on POS and web platforms at no additional cost.

Providus Bank informed its customers that they can now enjoy an increased international spending limit during the summer, specifically with its Platinum Naira Card, though the bank did not specify the exact ceiling.

Read also: Banks resume international transactions on naira cards as FX liquidity improves

Wema Bank has also resumed international transactions on its naira-denominated debit cards with a monthly spending limit of $500. The bank announced that customers can now use their Wema Mastercard, ALAT Mastercard, and Visa cards for foreign transactions, including online purchases, point-of-sale payments, and ATM withdrawals outside Nigeria. This move is part of ongoing efforts by Nigerian banks to ease access to foreign exchange for customers and restore confidence in cross-border payment capabilities.

The ease of bank restrictions abroad marks a reversal from 2022, when Nigerian banks were forced to slash international spending limits on naira cards from $100 to as low as $20 monthly.

That decision was driven by a chronic shortage of dollars and the struggle of manufacturers and other real sector operators to access FX through official channels.

At that time, the official exchange rate stood at N430 per dollar at the Investors and Exporters (I&E) window. As of July 4, 2025, the exchange rate stood at N1,528.56 per dollar in the Nigerian Foreign Exchange Market (NFEM), highlighting the major shift in Nigeria’s FX landscape.

This recent move by banks follows months of suspended cross-border transactions due to FX volatility and persistent dollar shortages. The resumption of naira card usage abroad signals a renewed confidence in FX liquidity and a more predictable currency environment, analysts say.

Analysts view the development as a significant boost to consumer and investor sentiment. It provides much-needed relief to customers who use naira cards for services such as online subscriptions, travel, and shopping on foreign platforms.

‘Aligns with IMF recommendation’

Razia Khan, managing director and chief economist for Africa and the Middle East at Standard Chartered Bank, noted that this step aligns with policy recommendations from the International Monetary Fund (IMF). She said, “It was one of the measures suggested in the latest Article IV consultation. The idea is that with a floating exchange rate regime, Nigeria no longer needs to maintain certain capital control measures.”

‘Evidence of naira stability’

Echoing that view, Ayodeji Ebo, an investment professional and managing director/chief business officer at Optimus by Afrinvest, described the development as evidence that current FX reforms are working.

“This further reinforces that the current foreign exchange management strategy is yielding positive results, as evidenced by the improved liquidity in the official market,” he said. “It is also helping to ease pressure on the parallel market, with demand gradually shifting back to the official window, thereby narrowing the gap between the two rates. This is a positive development for the economy.”

He added that the recent appreciation of the naira in the past few weeks has added to market optimism. “This move adds to the growing confidence that the currency may remain relatively stable in the short- to medium-term, which is encouraging for businesses and investors alike.”

Read also: Naira closes week strong as banks reinstate overseas card transactions

Past hurdles

The restrictions on international transactions using Naira cards severely disrupted Nigerians’ ability to access essential foreign goods and services. From January 2023, some banks suspended or capped usage, first reducing limits to as low as $20/month, then halting all cross-border spending with naira cards. This choked individuals and businesses alike: students struggled to pay for visa fees, professionals saw domain and hosting renewals fail, and content subscriptions like Microsoft 365, Apple Music, and Netflix became inaccessible.

E-commerce startups and small businesses faced higher costs and inefficient workarounds, turning to expensive parallel market FX and fintech alternatives, all while limiting growth and deterring foreign investment.

The limits also fuelled Nigeria’s parallel (black) FX market and fintech sector. Many Nigerians turned to dollar-denominated virtual cards or domiciliary accounts, often funded at inflated black‑market rates, sometimes double official rates, driving further pressure on the naira.

Higher costs for ordinary consumers, disrupted business operations, and a permanent shift toward unofficial exchange channels all undermined confidence in formal banking and stability in the FX market.

Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise (CPPE), attributed the recent resumption of international transactions with Naira cards by Nigerian banks to improved liquidity and stability in the foreign exchange (FX) market.

According to him, these developments have restored confidence in the system, both for financial institutions and their customers.

“What has happened is that the liquidity in the FX market has improved. The exchange rate has been more stable, and this has elevated the level of confidence of the banks in opening up transactions,” Yusuf explained. “For them, it’s a good business because the more these transactions take place, the better for them. And for the users, it provides a lot of convenience for their transactions.”

He emphasised the practical benefits for Nigerians, especially those who travel abroad. “As a Nigerian who’s travelling abroad, you don’t need to be carrying dollars in your pocket or in your bag. Sometimes, people have been embarrassed because of that. So, with your naira card, you can do whatever transactions you want,” he said.

“For Nigerians that are abroad, if they have Naira accounts here, you can pay into their naira accounts and they do their dollar transactions. I think it provides a lot of convenience.”