Now the Game is Rigged; The Realities of CBN's 🏦 Ban On International Transactions💳
What is it with the Naira or is it Just me?
Hello Innovator!
We'll pick up right where we left off last week, so if you missed it be sure to check it out here.
It seems that Naira is the talk of the town. From the scarcity of the newly released notes to the impossibility of international transactions with the Naira debit cards, Naira just keeps giving us content! Keep it up 👍 Naira, Nice one!
Last week we discussed not freaking out over the decline of your Naira debit cards on international platforms and we gave feasible solutions. Today we will discuss the effects of this change in the tech space in Nigeria.
But first, let's have a good laugh from tech Twitter.
😂 To be honest, maybe the employees too.
You just have to remember the tips we shared earlier this year, don't take too much of the Facebook pill 💊.
We already discussed that international transactions are not altogether impossible, you would just have to pay through your nose to acquire the goods or services you need. This is the reality of the exploitation that Nigerians have been exposed to from the black market in light of CBN’s decision.
Let's talk about some of the realities of the situation.
What Did The Banks Do About The international Transactions Ban?
What did they do? Did you really just ask that?
Well, let's just say they followed the order like they had been waiting for the instruction all along, or so it seems.
It's not like they had a say in the matter, I mean who would want to lose their license to operate or worse still be fined over something as little as taking the international freedoms of their customers away?
To be fair some banks offer monthly limits ranging from $15 to $20. Lol, is it for Garri? Is it for eba? Is it for Beans and Dodo?
The question is simple. What happens when your needs exceed the limits?
On the other hand, some banks don’t even offer limits. I'll try my best to use pseudonyms to protect the identity of some pioneer O.Gs, First Bank, and Zenith Bank. Ooopsie! there you have it, I guess It slipped out of my pen 🖋️.
Anyhoo, words on the street have it that these two banks among many others do not even offer as much as monthly limits to their customers.
I’ll cut Zenith bank some slack here. I do not mean to be meddling, but they already had to close some branches this week due to some reasons, which they gave the press (reasons only they understand). It was widely suspected that they planned to shut down nationwide, but that’s a gist for another day. Check out our Notable Reads For The Week for more info on the Zenith bank Saga.
Moving on…
Even in the midst of all these let's celebrate 🥂🥳 a quick win!
Starlink Launches In Nigeria, Making It The First African Country To Offer Elon Musk's SpaceX Internet Service
Naija no dey carry last! Common let’s hear it for Nigeria.
As a leading tech giant in Africa 🌍, it is no surprise that Nigeria was a plausible choice for Elon Musk.
In the past few days since its launch, Nigerians have been checking out the "New boy in town" - Starlink. It seems everyone has something to say about either the price or the installation.
You can be sure that after Starlink's announcement on Twitter, local virtual dollar card service providers were right on cue to sell their services. If you remember our last newsletter issue, I’m speaking of our very own Payday and chipper cash.
Let's hear from a seemingly frustrated verified Twitter user.
This would be a good time to state that the quoted tweets in Consonance's newsletters, do not always represent Consonance's viewpoint or represent it in its entirety but are all to make a point per issue. Thank you.
It looks to me that this International transaction ban seems to affect even our big wins now.
This Twitter user has clearly stated the issue. The reality we are faced with is that if we had our Naira debit cards with CBN's rates we would pay less to enjoy Starlink. However, since we have no choice but to turn to virtual dollar card services, it's safe to say you will be paying two times more to have your SpaceX internet service.
But, it seems some Nigerians couldn't care less about the exchange rate.
Someone is somewhere right now placing an order for Starlink to surprise bae on Valentine's day💌. God when?
What Is The International Image Of The Naira and Nigerians?
It seems like Nigeria might be forcing some international companies into compliance in a way that could only be interpreted as an influence. I'll let you be the judge, just hear me out.
At least we know of an Australian-based tech learning platform Entry-level, which has been going through the process of obtaining a local Nigerian Company and bank account to cater to the needs of its Nigerian customers.
In an email “An Open letter to our Nigerian Friends” from the CEO Ajah Prakash on the 8th of February 2023, it was apparent that CBN's decision ruffled the waters on their end too.
The email went into detail about how CBN's order has caused Nigerian users to experience declined transactions and how some transactions are also flagged from their end. He also talked about how the virtual dollar card offered disparity in foreign exchange rates.
The BVN acquisition process has been stressful, but this company is resilient to see it through. As a result of probably being the first Australian country run by a Non-Nigeran, acquiring the BVN requires a lot of negotiation.
The good news is that they have received all the necessary paperwork, and they look forward to setting up local payment processors like PayStack, Flutterwave, and more when they have their Nigerian bank account.
We are honestly proud of Entry-level and equally grateful for their service to the tech community in Nigeria and we salute their resilience in the face of unforeseen circumstances. Entry-level has shown us how innovative thinking can help overcome uncertainties and provide solutions to issues, we should all learn something here.
Is this how things would continue? Would every international company open a local bank account to serve its Nigerian audience? Certainly not, but I guess we are about to find out.
Share With A Friend
All these issues got Consonance thinking that could there really be some innovators to ease Nigerians of some burdens in the tech space.
If you missed it, we rolled out a call for innovators yesterday, so check your inbox so you don’t miss your package. You might know someone innovative who would benefit from the community, and that’s why you should share this newsletter today.
It’s your contribution to a better Nigeria, and a better Africa by extension. We are ready to walk hand in hand with innovators who believe in their dreams by sharing accelerators, hackathons, and more.
Are you on board with us? Yes.
Great. Now tell a friend to tell another.
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