Improved foreign exchange liquidity driven by economic reforms is prompting Nigerian banks to expand international spending limits on naira cards, signalling renewed confidence in the economy and easing access to global payments, ARINZE NWAFOR writes
Deposit Money Banks are increasing the amount naira cardholders can spend abroad as dollar liquidity strengthens across the financial system. Following financial sector reforms and the clearance of a $7bn foreign exchange backlog by the Olayemi Cardoso-led Central Bank of Nigeria, foreign exchange inflows into the economy continued to rise, reaching $112bn by the end of 2025.
The increase in autonomous foreign exchange inflows, foreign portfolio investments and non-oil export proceeds is enabling local banks to raise international spending limits on naira cards while also supporting foreign direct investment into the domestic economy.
Before the Olayemi Cardoso-led management team assumed office at the Central Bank of Nigeria in October 2023, one of the most significant challenges confronting the economy was acute foreign exchange scarcity. As a result, businesses and travellers were forced to rely heavily on the parallel market to obtain foreign currency, a development that encouraged speculative activities in the foreign exchange market.
To address the challenge, one of the first major actions taken by the Cardoso-led CBN in 2023 was the introduction of a series of reforms aimed at attracting foreign capital, restoring exchange rate stability and strengthening price stability.
Among the measures implemented, the apex bank liberalised the foreign exchange market and ended central bank financing of fiscal deficits. These steps helped improve investor confidence, enabled Nigeria’s return to the international capital market last December and contributed to rating upgrades from international agencies. The reforms have also significantly strengthened the country’s foreign exchange reserves and improved liquidity in the FX market.
Naira-funded debit cards
Reflecting improved dollar liquidity, Nigerian banks have begun removing the more than three-year restriction on the use of naira-funded debit cards for international transactions. Guaranty Trust Bank recently increased the quarterly dollar spending limit on its naira cards to $20,000, giving customers greater flexibility when making payments abroad.
In an email to customers titled “Important Update on Your GTBank Naira Card,” the bank announced that cardholders can now spend up to $20,000 every quarter. The Dollar Limit on your GTBank Naira Card is now $20,000 quarterly. The funds are reliably available on Point of Sale and online transactions.”
The bank had previously maintained quarterly limits of $1,000 for online and POS transactions, while ATM withdrawals were restricted to $500.
Other lenders, including United Bank for Africa Plc, FirstBank and Wema Bank Plc, have also resumed international transaction services on naira debit cards. In a notice to customers, UBA stated that the development aligns with its commitment to delivering improved banking experiences.
“In line with our continued commitment to providing you with seamless and enhanced banking experiences, we are pleased to inform you that all UBA Premium Naira Cards, including Gold, Platinum, and World variants, are now enabled for international transactions,” the bank said.
“This means you can now use your Premium Naira Card for everyday payments, online shopping, POS, and ATM transactions across the world, with more ease and flexibility. If you haven’t used your card recently, now’s a great time to rediscover the convenience and prestige that comes with being a UBA premium cardholder.”
Wema Bank also recently informed customers that they can now make dollar-denominated payments using their naira cards. “Your Wema Naira Mastercard just went global! Now you can pay in dollars on all your favourite international platforms: Amazon, eBay, AliExpress? Netflix, Spotify, YouTube,” the bank said.
Likewise, FirstBank notified customers through an email that its Naira Mastercard is once again available for international transactions. “Shop online or spend up to $500 every month on your preferred channel seamlessly,” the bank said.
To simplify offshore transactions for customers, FirstBank, in partnership with Visa, launched Visa Signature, a premium card product designed for Nigeria’s affluent market segment. Visa Signature is targeted at top executives, business owners and frequent international travellers who demand enhanced value from their financial products.
Commenting on FirstBank’s objective for premium cardholders, Group Executive, eBusiness & Retail Products, FirstBank, Chuma Ezirim, said, “At FirstBank, we are dedicated to creating financial solutions that reflect the evolving lifestyles of our customers.”
Highlighting the strategic significance of the partnership, Vice President and Cluster Head, West Africa, Visa, Andrew Uaboi, said, “Nigeria’s affluent consumers are among the most active and globally connected spenders on the continent. Visa Signature is designed to serve that profile with the depth of benefits and the breadth of acceptance they deserve. We are delighted to work with FirstBank in making this available to the Nigerian market.”
The Head of Financial Institutions Ratings at Agusto & Co, Ayokunle Olubunmi, attributed banks’ decisions to reactivate naira cards for international transactions to improved liquidity in the foreign exchange market. “The moderating premium on the parallel market transactions and the reduced arbitrage opportunities are also responsible for the decision,” he said.
Managing Director of Financial Derivatives Company Limited, Bismarck Rewane, linked the increase in foreign exchange inflows to stronger oil prices and the multiple inflow channels established by the CBN.
According to him, the apex bank created several avenues for foreign exchange inflows to boost dollar availability, improve access for manufacturers and retail users, and support the recovery of the naira across various markets.
Through measures aimed at improving diaspora remittances, introducing new financial products, licensing additional International Money Transfer Operators, implementing a willing buyer-willing seller foreign exchange model and facilitating timely access to naira liquidity for IMTOs, the CBN has simplified dollar inflow channels for authorised dealers and other participants in the value chain.
Market confidence
Founder and Chief Consultant of B. Adedipe Associates Limited, Prof Abiodun Adedipe, identified several policy reforms that are yielding positive outcomes for the economy.
According to him, the CBN’s foreign exchange reforms have eliminated unusual arbitrage and round-tripping opportunities in the market. He also noted that fuel subsidy removal by the Federal Government ended an annual burden estimated at $10.7bn and created a more competitive operating environment.
He added that the ongoing bank recapitalisation exercise is producing stronger financial institutions capable of supporting a $1tn economy, while fiscal consolidation efforts are plugging leakages, enhancing accountability through technology deployment and expanding fiscal space at the sub-national level.
Adedipe further stated that tax reforms remain the most transformative initiative, with the potential to stimulate regional competition, which he described as a key driver of China’s economic rise.
He also identified the Nigerian Education Loan Fund, Consumer Credit Corporation, recapitalised Bank of Agriculture, National Credit Guarantee Company Limited and single-digit mortgage loans as important measures needed to support sustainable economic growth.
According to Adedipe, Nigeria enjoys significant demographic advantages, including a large, youthful and rapidly expanding population estimated at 237.53 million in July 2025, making it the sixth-largest population globally, with a median age of 18.1 years.
He also pointed to increasing urbanisation, which rose to 54.28 per cent in December 2023 from 46.12 per cent in 2013 and 51.96 per cent in 2020. Internet penetration has also continued to improve, reaching 48.15 per cent in April 2025 from 45.57 per cent in August 2023 and 31.48 per cent in December 2018.
Nigeria’s teledensity stood at 79.65 per cent in May 2025, compared to 76.08 per cent in December 2024 and 102.97 per cent in December 2023, following a data clean-up exercise conducted at the end of April 2024.
“On global internet users, it shows that Nigeria, with 123 million, ranks 11th and 7th with over 84 per cent on mobile devices. Local oil refining continues to expand, and prospects of new refineries, manufacturing is reviving, and there is expanding interest in non-oil exports. Improvement in infrastructure will begin to positively impact the cost of doing business,” he said.
He added that sustained structural reforms would improve Nigeria’s global competitiveness, strengthen the ease of doing business, reduce leakages and narrow opportunities for economic rent-seeking.
Fiscal, monetary policies
The CBN has maintained that monetary reforms cannot succeed in isolation. According to the apex bank, coordination with fiscal authorities has improved macroeconomic stability and delivered measurable outcomes, including lower domestic borrowing costs, better liquidity conditions and more predictable fiscal operations.
The discontinuation of direct deficit financing remains a central element of that strategy. “This stance is unequivocal, as there will be no return to the practice of financing fiscal deficits by the central bank. In parallel, the fiscal authorities have embarked on key institutional reforms – including the implementation of a Revenue Optimisation framework, the establishment of a new National Revenue Agency, and upgrades to the Treasury Single Account – to strengthen revenue mobilisation and public financial management,” Cardoso said.
“As we transition towards a full-fledged inflation-targeting framework, this partnership will deepen, ensuring fiscal and monetary policies reinforce each other in delivering durable price stability,” he added.
Since assuming office, the Cardoso-led CBN has implemented a series of reforms aimed at attracting foreign investment, stabilising prices and strengthening exchange rate management.
In 2023, the new administration and the apex bank liberalised the foreign exchange market, ended central bank financing of fiscal deficits and reformed fuel subsidy arrangements. The government also intensified revenue collection efforts and introduced measures to curb inflationary pressures.
Since the implementation of these reforms, external reserves have grown and access to foreign exchange through official channels has improved.
Nigeria successfully returned to the international capital market last December and recently secured upgrades from rating agencies. In addition, a new privately owned domestic refinery is helping position the country further up the value chain within a fully deregulated market.
The CBN’s policies, including exchange rate reforms, have contributed to increased investment inflows and reduced the need for direct intervention in the foreign exchange market.
The unification of exchange rates and the clearance of more than $7 billion in foreign exchange obligations improved Nigeria’s investment outlook, with multilateral institutions such as the World Bank describing the measures as bold interventions capable of strengthening long-term economic sustainability.
Nigeria’s sovereign risk spread has also declined to its lowest level since January 2020, erasing the premium accumulated during the COVID-19 pandemic and the economic challenges that followed.
These measures form part of broader efforts to attract investors and sustain capital inflows into the economy.
As part of efforts to tackle inflation, the CBN recently convened the Monetary Policy Forum, bringing together fiscal authorities, legislators, private sector stakeholders, development partners, subject-matter experts and academics under the theme, “Managing the Disinflation Process.”
The forum represents a major effort to strengthen monetary policy communication, encourage dialogue and foster collaboration on issues influencing policy decisions.
At the event, Cardoso said the apex bank remains focused on maintaining price stability, advancing the transition to an inflation-targeting framework and restoring purchasing power to ease economic hardship.
He reiterated that the CBN would continue to pursue a disciplined monetary policy approach aimed at reducing inflation and stabilising the economy. According to him, the objective is to ensure that monetary policy remains forward-looking, adaptive and resilient.
“In addressing our economic challenges, collaboration is key: Managing disinflation amidst persistent shocks requires not only robust policies but also coordination between fiscal and monetary authorities to anchor expectations and maintain investor confidence.
“Our focus must remain on price stability, the planned transition to an inflation-targeting framework, and strategies to restore purchasing power and ease economic hardship,” Cardoso said.