UBA Reduces International Spending Limit on Naira Card to $100

The United Bank for Africa (UBA) Plc has once again reduced the international spending limit on its Naira card as the lender grabbles with low forex liquidity.

UBA reduced its international spending limit on Naira card from $500 announced in May during the peak of COVID-19 to $100 on August 21, 2020.

The lender attributed the decision to the uncertainties in the foreign exchange market. It would be recalled that the central bank had suspended sales of forex to the bureau de change operators and devalued the Naira by 15 percent to N360 to a US dollar before finally adjusting it to N379 per US dollar to further ease pressure on the nation’s foreign reserves and curb the growing demand for forex by investors looking to move funds out of the country.

These changes in economic fundamentals impacted banks’ operations as they also struggle to access forex from the apex bank and mainly rely on forex deposits from a few customers.

This is coming two weeks after GTBank announced it has capped international spending limit on its Naira MasterCard to $100 per month from the previous $500.

In an email forwarded to all customers, UBA said “in light of the uncertainties in the foreign exchange market, we have had to review international card spending limits.”

“The new applicable limit on your Naira card is $100 (or its equivalent in other foreign currencies) monthly effective tomorrow August 21, 2020. Whilst we note this significant reduction from your previous spend limit, we would like to reassure that this limit will be revised upwards as the market uncertainties improve.

“We apologise for any inconvenience this may cause and would like to thank you for your understanding at this time.”

Weak foreign reserves amid low oil prices and weak demand continue to dictate Nigeria’s economic outlook, especially given that it is an import-dependent economy.