Business
Nigerian Banks ration PTA as Dollar scarcity bites
Commercial Banks in the country are said to be rationing the few dollar available among customers applying for the $4,000 Personal Travel Allowance (PTA) due to the persisting dollar scarcity in the country.
A customer who visited one of the banks said she was surprise when she was handed $2,500 dollars of the $4,000 due her under the statutory provision on Personal Travel Allowance (PTA).
Aghast, she looked on, hoping to hear that the balance would be handed over to her in a couple of minutes only to be told by the Teller that the balance would be given to her within seven working days.
Her rage quickly turned to tension seeing that her travel date was only some days away and the alternative market for meeting her forex needs, the black market, is a no-no, considering the hefty difference in margin.
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Thousands of applicants go through this harrowing experience as they get their PTA in two or three tranches depending on what is available in the banks’ vault. Some get $1,000, $2,000 or more and are asked to access the balance in their dollar debt cards, which are usually not enough for their spending needs abroad because of banks’ spending limits.
It was however gathered that some applicants for PTA have, however, found ‘smarter’ ways of getting their dollar supply by having multiple applications in different banks thus challenging the effectiveness of commercial bank measures at rationing.
Meanwhile, bank sources confirm banks just can’t help the situation given the rush for PTA and the scarcity of dollars. “There is a long queue of applications that we have to deal with,” one customer service officer said.
Another source, a senior manager with a bank that recently got a national license said the measures are designed to checkmate speculators. “You know a lot of people now trade in the dollar”, he said.
READ ALSO: Banks stop issuance of Letters of Credit as FX scarcity bites harder
He explained that it is suspected that people get these allocations at the official rate of N420 only to turn around to “go and engage in arbitrage activities”.
By that, he means that after getting their dollar allocation at N420, they sell for N720 at the black market thus making a margin of N300. A quick calculation shows that a smart Alec can stash as much as N1.2million from his $4,000 PTA allocation on a margin of N300 to the dollar.
But before the February directive, in March 2017, the CBN committed to meeting all forex needs of Nigerians thus directing that all banks should introduce Teller Points to ensure that customers can access forex. This is also as directed that all banks must display electronic boards displaying the prevailing market rates of forex to ensure transparency of their dealings.
Banks were further directed to meet all PTA needs within 24 hours of application and respond within 48 hours if the application was in respect to paying school fees and medical bills.