Nigerian banks require up to one month to provide customers with dollars for their offshore expenses, a move that will limit access to the currency at a time when the central bank is squeezing supplies to banks, industry sources said on Wednesday.
Nigeria is facing chronic dollar shortages while rising demand has put pressure on the naira, as providers of foreign exchange such as offshore investors exited the Nigerian economy after the COVID-19 pandemic triggered an oil price crash.
Oil prices have since recovered and soared, but a backlog demand for dollars has dogged currency markets and the naira .
The central bank has been battling to protect dwindling reserves and has introduced a hybrid exchange rate regime with different rates depending on who is buying dollars.
It is unclear whether the central bank was involved in Wednesday’s decision by the banks. In the past, it has imposed similar measures on commercial banks.
“Due to limited FX availability provided by the Central Bank of Nigeria, we require a 30-day period to fulfill requests for school fees, upkeep and rent payment,” Access Bank said in a notice to customers.
One Nigerian commercial bank forex trader said the dearth of dollars was to blame for the latest decision.
Lenders now require 14 days to process foreign currency allowance for international travel, said Access Bank, Nigeria’s biggest lender. It added that all forex requests were reviewed to ensure they meet regulatory requirements.
The central bank on Tuesday hiked its benchmark interest rate for the first time in more than two years to try to curb inflation, attract inflows and support the currency, which has weakened sharply on the black market, where it trades freely.
In March, local banks suspended individual withdrawals with local debit cards abroad and toughened limits on online payments, after the central bank last month said it would stop dollar sales to lenders this year.
