We spoke to seven Nigerians about how the new $100 limit is affecting them – they range from Lagos businesswomen who imports clothes and “adult toys” to a student who uses a Naira debit card to meet daily expenses in Europe.
It is that time of the oil cycle again when Nigerians receive text messages from their banks politely advising them to limit spending on their debit cards to $100 per month. Naira debit cards can no longer be used to buy shoes on Amazon, pay for international examinations or withdraw euros, dollars or pounds from ATMs to cover expenses while abroad. Oil prices have fallen and the Central Bank of Nigeria (CBN) cannot meet the demand for dollars.
Arbiterz’s preferred approach to managing foreign exchange would be for the CBN to “smooth” the demand for dollars by making it more expensive when the oil price is high so that enough remains (in the forex reserves) when oil prices fall.
As they say, it is what it is. The CBN encourages Nigerians to spend abroad when oil prices are high by supplying dollars at a high and unsustainable exchange rate. It asks them to almost go “cold turkey” when the oil price falls.
We spoke to seven Nigerians about how the new $100 limit is affecting them – they range from a Lagos businesswoman who imports clothes and “adult toys” to a student who uses a Naira debit card to meet daily expenses in Europe.
Here are their views:
Franklyn Ikediasor, Virtual Acquisitions & Digital Customer Experience Staff at a Bank
I use Sterling Bank and I like using it because I can depend on it for international transactions. I do I buy a lot of things on Amazon, Etsy and Ali Express. I mostly buy shoes and clothes. I find that clothes are expensive here. People buy clothes on the high street in the UK and sell at ridiculous prices down here. You see someone trying to sell ZARA for N35,000 to you and you find that ZARA is not even high-end. I mostly buy clothes and shoes online. I also buy books. I collect a lot of jewelry: cufflinks, cocktail rings, studded buttons and stuff like that. Those are the things I spend online.
The most I have spent on a single transaction is €4,000 though that was for school fees. The $100 limit is a regulatory requirement for forex control in Nigeria and I feel like the regulators are doing what is necessary to stabilize the naira and keep the economy afloat. Some of my purchases are affected. I have to batch my purchases. It is a bit of an inconvenience but I feel like this is what the policymakers think is going to help the economy. It does not hurt for us to support them. If there is a further reduction, we will just adjust.
Gbemisola Daniel, Journalist
I use three banks actually, GTBank, FirstBank, and Access Bank. They each serve a different purpose. I buy things online once a month at least, or twice. There is no month I do not make foreign transactions. I like shopping online. It is a vibe for me. I buy clothes, shoes, gadgets, fashion accessories and many more. The most I have ever spent is $1,200. I bought a bunch of stuff from ASOS and Amazon back in mid-2019. I heard about the $100 limit on Twitter at first, then I saw it when I was going through the newspaper the next day. I feel so bad about it. Does this mean I cannot spend on stuff above $100?
I sometimes buy a single product that costs $100. This is ridiculous. I am still trying to wrap my head around the whole thing. It does not make sense to me. I hardly buy clothing here in Nigeria. I mostly just order from abroad online and they ship down here. It is much cheaper and I am assured of better quality. Most stores in Nigeria sell clothing for ridiculous prices. This is why I prefer ordering from foreign online stores. If there are further restrictions on the use of the debit card, I would probably just ask my friends over there to order from their end and then ship it down to me. I think it is easier that way. I might just need to tip them.
Princess Anene, Businesswoman who runs an online store
I use GTB and Stanbic Bank. I buy eyewear, fashion accessories and adult toys from foreign websites. My purchases are important to me because I sell these things to earn an income. Nigeria is so hard right now without the bonus income. I have been unemployed since graduation and have been a full-time housewife with no source of livelihood but my husband.
The most I have spent on my card at once is $500. If we want to spend more, we use procurement agents but that is way more expensive as they add their own charges. I found out about the $100 limit on Twitter and it is really upsetting. With the new limit, we have to resort to only procurement agents to purchase goods and that would increase the cost of goods since we have to factor that into our pricing. This means our products will be more expensive. A further reduction of the amount of dollars we can spend in a month would be the end. They are just trying to run struggling entrepreneurs out of business.
Mark, United States of America Resident
I was using Access Bank but I had trouble with that account. I currently use Sterling Bank. I use my debit card for my rent and bills. Before now, I could withdraw up to $500 from the ATM. But in July, my bank sent me a text saying that $500 had become the monthly limit, $100 was the daily limit, $200 via POS and $200 via web. But now it has become worse, how can one survive on that? I cannot survive on that but I will have to find my way around the system. I might leave this country soon and come back to Nigeria since airports are opening up. It is becoming difficult to use my card here. Or I can find someone who has cash and credit them with Nigerian naira while they give me the equivalent in dollars.
Abimbola Idowu, Pharmacist
I use Zenith Bank. I have an online fashion store. My customers pre-order fashion items like shoes or bags from me and I get these items from UK and American stores. So, I purchase those goods for them. I also used my card recently to pay for my Canada Express entry application, which was $1,050. I am unhappy about the new $100 limit because it is really affecting my business negatively. I have a few things I need to get for some customers, which is about $200 and this is just for one customer. Imagine having to wait for 2 months just to get $200 worth of items.
Most times, these people want their goods within a 2-week timeframe. Why did they even reduce the limit in the first place? It is really annoying to be very honest. I have friends who have been unable to pay for their Canada entry applications. How do you pay $1,050 if the limit is $100 or $200? I would be very sad if they reduced it even further.
Ore Solarin, Student in Ukraine
I do not yet have an account over here. So, I am using my debit card from Nigeria. It’s a First Bank card. I use my Nigerian card in Ukraine for everything. I practically live on my card. I buy foodstuff, pay for transport, buy things for the house, pay for my gym, order things online, pay my bills etc. The most I have spent at once with my card is $250. I was buying home appliances.
My mum sent me a text informing me of the new limit. I thought it was a joke initially. I never wanted to open an account here, but I think I have to now. For now, I am trying to get an account because I really cannot do anything with my First Bank card anymore. With the previous $500 limit, I finished that in roughly 2 to 3 weeks. So, the $100 limit means that I cannot even do anything. I can buy food here and there but anything else is a no-go area. I think everyone abroad should just forget about using Nigerian cards for now.
Abasiono Adams, Videographer, Photographer and Voiceover Artist
I just completed my Master’s degree program in Applied Digital Media at Griffith College, Dublin. I use a Guaranty Trust Bank card. I do not directly buy stuff with a debit card. The exchange rate is terrible. I am based in Ireland but I have a dollar account with GTB. I normally buy Euro from someone by transferring naira to them. The new monthly spending restriction is not a good idea, to be honest. For instance, my house rent costs €600 monthly. That has way exceeded the spending limit. So, for those of us living outside the country, it is not fair because we have to look for other means to get money across. Reducing the limit further would mean things will get even worse. It won’t favour anyone, except the banks.