Like United Bank for Africa, Zenith Bank has also halted international Automated Teller Machine (ATM) cash withdrawals and POS transactions on all Naira cards, the bank disclosed in a statement forwarded to all customers on Wednesday.
For web transactions, the leading lender reviewed downward its monthly limit from US$100 to US$20, attributing the decision to the current economic realities of Nigeria.
The announcement was made during a record-high oil price, the only viable means by which the Nigerian nation generates foreign exchange necessary to service its import-dependent 200 million nation.
However, Africa’s largest economy and the continent’s largest exporter, is not expected to profit from the surge in global oil prices. This is because of Nigeria’s economic structure and lack of refineries. Hence, why Nigeria imports finished petroleum products from overseas.
The Federal Government has to subsidize imported fuel so that majority of Nigerians without constant electricity, transporters and other fuel users can afford it.
Sadly, this increase in crude oil prices means, the landing cost per litre will increase. Therefore, Nigeria’s profit from crude oil will be used to pay for subsidy, or Nigerians battling with a 33.33% unemployment rate, high inflation, low new job creation and weak wage growth will not be able to afford it.
A few weeks ago, it was the United Bank for Africa Plc that halted international spending on Naira cards while the Central Bank of Nigeria launched a N65 per dollar rebate scheme to lure exporters to Investors and Exporters forex window. On Tuesday, the First Inland Revenue Service announced a one-month concession to allow companies with dollar tax liabilities to pay in Naira due to forex scarcity. All these point to one thing, there is no forex.
As stated in my UBA article, “Given that the announcement was made on the day Russia attacked Ukraine and bolstered global risk to the highest level in recent years, UBA may be responding to possible forex challenges that lie ahead, especially with Nigeria’s inability to capitalise on the current rise in global oil prices due to her weak oil production infrastructures.”
Zenith Bank, however, concluded with “If you have higher international spending requirements, simply visit any of our branches and request for a foreign currency debit or prepaid card, which are available in US Dollar, Pounds and Euro variants.”
