The Central Bank of Nigeria (CBN) has ordered commercial banks to stop customers from using their debit and credit cards abroad, a source has told the BBC.
One bank has emailed customers to this effect, stressing it is a “temporary measure”.
Access to foreign online retailers will also be affected when the ban takes effect on 1 January 2016. It is part of the government’s effort to try to stem the flow of foreign exchange out of the country.
The unofficial value of the Nigerian currency, the naira, has plunged because of the fall in the oil price – its main export. Africa’s largest economy has spent billions of dollars propping up the currency since it fixed the exchange rate in February and tightened trading rules to curb speculation.
It is not clear how many people will be affected by the latest measure but the BBC noted that wealthy Nigerians travel abroad regularly and use their local cards for shopping and other transactions. Some top-end shops in London have signs in Hausa to cater for the large number of Nigerian customers.
One of the banks, Standard Chartered, has emailed its customers notifying them of the ban. In June, the central bank banned businesses from accessing hard currency to import about 40 items.
The list included Indian incense, toothpicks, plastic and rubber products, soap and even private jets.
The amount that Nigerians could spend on credit cards abroad had already been reduced by the banks.
But a source at the CBN who spoke to THISDAY on condition of anonymity, said the directive was not given by the central bank, but was as a result of personal decision by the banks.
Meanwhile, Nigeria’s non-deliverable forwards rose across the curve by over two per cent on Tuesday, after the country’s government said it expected its budget deficit to double to around N2.2 trillion ($11 billion) next year.
Non-deliverable currency forwards, a derivative product used to hedge against future exchange rate moves; indicated markets expected the naira’s exchange rate to be at N262 to the dollar in 12 months’ time, according to Reuters. It was the weakest rate against the dollar in three months and compared to 256.75 at Monday’s close.
“The currency has been under enormous pressure,” emerging market fund manager at Ashmore, Jan Dehn said.
He said Nigeria’s plan to spend to make up for losses to the economy from falling oil prices wasn’t sustainable.
“Since (President Muhammdu) Buhari has come in he has done everything wrong and nothing right… It (the non-deliverable forward rate) is going to go wider from here, so it doesn’t bode well for Nigeria.”