GTBank Suspends Naira Payment For Foreign Transaction With Naira Debit Cards

Guaranty Trust Bank (GTBank) is no longer accepting naira payment for foreign transactions. GTBank suspended the transfer of funds in naira on its Naira Debit Cards, demanding that its customers in Nigeria pay in the currency of the foreign destination.

This was made known in an email sent to customers residing in Nigeria. The new development contravenes the tradition of payment in naira terms, while the lender transfers the payment in the currency of the destination. The change in policy happened at a period Nigeria's dollar reserves is low.

The customer had tried to make payment for a Facebook advert when she was informed that the transaction failed and told to select the currency of the country you are transacting in, “Dear Valued Customer, Declined Card Transaction: DCC Restriction. Thank you for using your GTBank Naira MasterCard. Please be informed that your transaction with the details below could not be completed because you have selected the DCC payment option (Dynamic Currency Conversion) that allows you to pay in Naira, which has been temporarily restricted on all our cards. Please reattempt the transaction and select the currency of the country you are transacting in.”

According to The Nation which reported the new development, banks are now demanding that customers make payment through inflows from abroad, in line with Central Bank of Nigeria’s (CBN) domiciliary account policy, The policy directs that if a customer intends to transfer funds abroad to a third party, such funds must be that which was initially transferred through electronic fund transfers into their domiciliary accounts. And only cash deposits into such accounts can only be withdrawn in cash.

Commenting on the issue, Head of Research, Afrinvest West Africa Limited, Abiodun Keripe, said the CBN was responsible for making dollar payment for customers paying in naira or whose naira accounts were debited for transactions. According to Keripe, the availability of dollars in Nigeria's reserves determines if CBN can make payment or not. And dollars have been on a decline since the coronavirus outbreak and oil price decline.

Although, AllNews reported that the CBN is already making $100 million available weekly for banks to sell to customers planning to pay school fees abroad and small and medium enterprises that need to import essential goods and materials needed for production or their business activities.