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Worship with us @ Mountain of Fire Miracles Ministries, Budapest, Hungary Address: 1081 Bp II János Pál Pápa tér 2 (formerly Köztársaság tér) Direction: From Blaha, take tram 28, 28A, 37, 37A, 62...1 stop. From the traffic light cross to the other side... Or take Metro 4 & get off @ János Pál Pápa tér
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Tuesday, 22 December 2015

MONEY/FINANCE

Banks blame ATM card ban abroad on round-tripping
Oyetunji Abioye

Deposit Money Banks in the country are recording unprecedented foreign exchange bills owing to heavy and frequent use of payment cards by their customers who travel abroad, it has been learnt.


The development, which has created huge forex debts with the banks’ international financial partners, has forced many DMBs to stop their customers from using their Automatic Teller Machine cards abroad, top bank executives told our correspondent on Sunday.

The top bankers, who spoke on condition of anonymity because of the sensitive nature of the matter, listed the countries mostly affected by the measure as China, United Arab Emirates and all African countries.

One of the bankers explained, “We stopped customers from using their payment cards when they travel abroad because a large number of them have created settlement problems for us. We have huge bills to pay in forex because many of the customers who are traders and importers are using multiple ATM cards to incur heavy forex liability for us in China and Dubai and some African countries.

“Also, some customers are engaging in round-tripping. They go to some of these countries, especially neighbouring countries in Africa, and use their ATM cards to create heavy forex liabilities for us. We just have to stop it; it is too much,” one of the bankers explained.

Diamond Bank, in a notice to its customers, blamed the current foreign exchange problems as the reason.

“Due to the current FX market realities, please be informed that your naira debit card has been restricted from usage in the UAE, China and African countries. We encourage you to make use of the Diamond USD or Diamond GBP debit card to transact in any of the above-mentioned countries,” Diamond Bank said in a notice to its customers.

As a result of the development, economic and financial experts have advised the CBN to look at the possibility of devaluing the naira as a way out of the problem.

Renowned economist and Managing Director, Financial Derivatives Limited, Mr. Bismarck Rewane, said, “The move by the banks are obvious signs of rationing and restriction by the CBN. I am not surprised. The solution is to let the exchange rate change.

“How long can we hold it? The forex is not there; so, the only thing is to allow the exchange rate to go. I think a combination of devaluation of the naira and some restriction will save us from the situation.”

The Head, Investment and Research, Afrinvest West Africa, Mr. Ayodeji Ebo, said the forex scarcity was caused by the administrative controls and restrictions by the CBN.

He said, “This measure and others will only compound our problem. The CBN needs to know that we don’t have sufficient reserves to keep holding the currency; the way out is to allow the naira to flow in order to reduce the dollar scarcity. If you devalue the naira, the scarcity will reduce.”

On his part, the Managing Director, Economics Associates, Dr. Ayo Teriba, said the move by the banks would weaken confidence of wealth holders, and advised the fiscal and monetary authorities to come up with plans to address the problem.

He said, “This is not a positive signal for us who are trying to attract and retain savings. If people are trapped overseas because they can’t use their cards, they will think twice in the future whether they should keep their money in Nigerian banks or outside the country.

“This is because when the rule of the game changes suddenly like this and people become stranded, they will think twice.”


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Editor's Mail

Love the article on Gaddafi
We must rise above tribalism & divide & rule of the colonialist who stole & looted our treasure & planted their puppets to lord it over us..they alone can decide on whosoever is performing & the one that is corrupt..but the most corrupt nations are the western countries that plunder the resources of other nations & make them poorer & aid the rulers to steal & keep such ill gotten wealth in their country..yemen,syria etc have killed more than gadhafi but its not A̷̷̴ good investment for the west(this is laughable)because oil is not in these countries..when obasanjo annihilated the odi people in rivers state, they looked away because its in their favour & interest..one day! Samosa Iyoha

Hello from
Johannesburg
I was amazed to find a website for Africans in Hungary.
Looks like you have quite a community there. Here in SA we have some three million Zimbabweans living in exile and not much sign of going home ... but in Hungary??? Hope to meet you on one of my trips to Europe; was in Steirmark Austria near the Hungarian border earlier this month. Every good wish for 2011. Geoff in Jo'burg

I'm impressed by
ANH work but...
Interesting interview...
I think from what have been said, the Nigerian embassy here seem to be more concern about its nationals than we are for ourselves. Our complete disregard for the laws of Hungary isn't going to help Nigeria's image or going to promote what the Embassy is trying to showcase. So if the journalists could zoom-in more focus on Nigerians living, working and studying here in Hungary than scrutinizing the embassy and its every move, i think it would be of tremendous help to the embassy serving its nationals better and create more awareness about where we live . Taking the issues of illicit drugs and forged documents as typical examples.. there are so many cases of Nigerians been involved. But i am yet to read of it in e.news. So i think if only you and your journalists could write more about it and follow up on the stories i think it will make our nationals more aware of what to expect. I wouldn't say i am not impressed with your work but you need to be more of a two way street rather than a one way street . Keep up the good work... Sylvia

My comment to the interview with his excellency Mr. Adedotun Adenrele Adepoju CDA a.i--

He is an intelligent man. He spoke well on the issues! Thanks to Mr Hakeem Babalola for the interview it contains some expedient information.. B.Ayo Adams click to read editor's mail
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