Deposit Money Banks (DMBs) are expanding the spending limits for naira cardholders abroad, driven by an increase in dollar liquidity within the financial system. Following sweeping financial sector reforms and the clearance of a $7 billion backlog by the Central Bank of Nigeria (CBN) under Governor Olayemi Cardoso, FX inflows have risen significantly, closing 2025 at $112 billion. This surge in autonomous FX inflows, foreign portfolio investments, and non-oil export proceeds is enabling banks to lift long-standing restrictions on naira card spending and supporting Foreign Direct Investment (FDI) into the domestic economy.
Prior to the current CBN leadership’s assumption of office in October 2023, the Nigerian economy struggled with acute forex scarcity. This forced businesses and travelers to rely on the parallel market, which fueled speculation. In response, Governor Cardoso initiated bold reforms in 2023 to attract foreign capital and achieve price and exchange rate stability.
Key measures included the liberalization of the foreign exchange market and the cessation of central bank financing for fiscal deficits. These steps restored investor confidence, allowing Nigeria to return to international capital markets last December and secure upgrades from global rating agencies. These reforms have significantly boosted FX reserves and market liquidity, leading banks to lift a moratorium on naira-funded debit cards that had been in place for over three years.
For example, Guaranty Trust Bank (GTB) recently increased the quarterly dollar spending limit on naira cards to $20,000. In a notice to customers, the bank confirmed that these funds are available for Point of Sale (POS) and online transactions, a significant jump from previous limits of $1,000 for online/POS and $500 for ATM transactions.
Other major institutions, including United Bank for Africa (UBA), FirstBank, and Wema Bank, have similarly enabled international transactions. UBA announced that its Premium Naira Cards (Gold, Platinum, and World) are now active for global payments, online shopping, and ATM withdrawals. Wema Bank also notified customers that their Naira Mastercards can now be used on international platforms such as Amazon, eBay, AliExpress, Netflix, and Spotify.
FirstBank has enabled international spending of up to $500 monthly on its Naira Mastercard. Additionally, in partnership with Visa, FirstBank launched the “Visa Signature” premium card, specifically targeting high-net-worth individuals, executives, and frequent international travelers.
Ayokunle Olubunmi, Head of Financial Institutions Ratings at Agusto & Co, noted that improved FX liquidity and a reduction in parallel market premiums have driven this decision to reactivate naira cards. Meanwhile, Bismarck Rewane, Managing Director of Financial Derivatives Company Limited, attributed the rise in inflows to higher oil prices and the CBN’s creation of multiple inflow channels.
These channels include improved diaspora remittance products, the licensing of new International Money Transfer Operators (IMTOs), and the implementation of a “willing buyer-willing seller” FX model, all of which have simplified dollar access for authorized dealers.
Policy Shifts Driving Market Confidence
Prof. Abiodun Adedipe, founder of B. Adedipe Associates Limited, highlighted several pivotal shifts: the elimination of forex arbitrage and round-tripping, the removal of the petrol subsidy—which saved approximately $10.7 billion annually—and ongoing bank recapitalization to support a $1 trillion economy. Adedipe emphasized that tax reforms and initiatives like the Nigerian Education Loan Fund and the National Credit Guarantee Company are critical for sustainable growth.
He further noted that Nigeria’s large, youthful population and rapid urbanization—with internet penetration reaching 48.15% by April 2025—provide a strong foundation for economic expansion. The expansion of local oil refining and a revived manufacturing sector are further reducing the cost of doing business and enhancing global competitiveness.
Synergy Between Fiscal and Monetary Policies
The CBN has emphasized that monetary reforms are most effective when aligned with fiscal policy. This synergy has resulted in reduced domestic borrowing costs and more predictable fiscal operations. Governor Cardoso stated that the bank will no longer finance fiscal deficits, signaling a commitment to financial discipline.
Parallel fiscal reforms, including the Revenue Optimisation (RevOp) framework and the establishment of a new National Revenue Agency, are strengthening public financial management. As the CBN transitions toward an inflation-targeting framework, these coordinated efforts aim to deliver durable price stability.
Economic Progress and Outlook
The unification of exchange rates and the clearing of the $7 billion FX backlog have improved Nigeria’s investment outlook, drawing praise from the World Bank. Consequently, Nigeria’s sovereign risk spread has fallen to its lowest level since January 2020, erasing pandemic-era premiums.
To combat inflation, the CBN recently hosted the Monetary Policy Forum to foster dialogue on the “Managing the Disinflation Process.” Governor Cardoso reiterated that the bank’s priority remains price stability and restoring purchasing power to ease economic hardship through a disciplined, forward-looking monetary policy.