It is hard to fault the decision by banks to suspend cash withdrawals from overseas Automated Teller Machines (ATMs) by Nigerian cardholders, save for account holders whose cards are linked to domiciliary accounts funded locally. Aside the sustained liberalisation of access to forex such as which currently allows individuals to purchase forex for Personal Travel Allowance (PTA), Business Travel Allowance (BTA), medicals and school fees with relative ease, it seems utterly superfluous that the would-be Nigerian overseas shopper would, in addition, be enabled to make cash withdrawals for whatever reason, using the naira card.
The country has come a long way since October 2016 when the banks, at the height of the foreign exchange crisis, announced the suspension of overseas ATM card services. Although the situation made it extremely difficult for travellers to pay their hotel bills, or make reservations and conduct other transactions using their debit cards, it was understood to have been borne of the exigencies of excruciating forex scarcity. Today, all of that has changed – thanks to the steady inflow of forex and the concomitant boost in foreign reserves.
The situation has since enabled the banks not only to lift the suspension placed on overseas ATM card services but to also raise monthly transaction volumes for customers on foreign currency-denominated deals, including those conducted on PoS machines and online. And all of these, buoyed by the considerably improved forex situation, and understandably in response to growing demands for greater flexibility and a more liberalised forex regime.
Knowing that Nigerians can now readily purchase PTA/BTA, and also with certainty that alternative transactional mechanisms other than cash are readily available, it comes as baffling that some Nigerians would still prefer to withdraw cash abroad. The only possible explanation is that such cash is ultimately for anything but legitimate ends. The case of a Dubai-bound Nigerian, Yasir Salihu Abdullahi, arrested on August 3, 2017, with 849 ATM cards of various Nigerian banks somewhat lends credence to this possibility.
It bears stating that our economy, despite the modest gains of forex accretion and relative stability remains relatively fragile. Considering that the economy is still largely import-dependent and one whose source of forex is still predominantly petrodollars, it seems only necessary to put in place such curbs to protect the nation’s foreign reserves and by extension the value of the domestic currency, and, to reduce the possibility of individuals using the particular window to launder cash.
There are of course other reasons why such curbs have become imperative. First, the world has long embraced the cashless culture, so Nigeria cannot afford to be left behind, more so as the enabling infrastructure are already substantially in place. Second, the pejorative image of the country directly linked to the unseemly culture in which Nigerians are seen in foreign shores carrying wads of currency for all manner of transactions needs to be changed through such deliberate measures. Third, the issue of corruption, of which cash transactions is evidently its chief enabler, has to be tackled with every available tool.
Nothing in the measure stops Nigerians with money from accessing their funds abroad for shopping or whatever purpose. What it does is prescribe rules on how this could be done to protect the nation’s economic interests and this within the broader rules guiding international financial transactions. It therefore goes without saying that the restriction is necessary.