KEY POINTS

• Nigeria’s net foreign exchange inflows rose from $950 million in 2022 to $9.22 billion in January 2026, an increase of about 871 per cent.
• Aggregate FX inflows increased by 45.24 per cent to $12.23 billion in January 2026.
• Foreign portfolio investments reached $15.8 billion in the first nine months of 2026, while external reserves climbed to $54.9 billion at the end of September.
• FirstBank and GTCO have raised quarterly international spending limits on their naira cards to $50,000 and $40,000 respectively.
• Differences in banks’ dollar spending limits reflect variations in their foreign exchange funding and liquidity positions.

MAIN STORY

Nigeria’s net foreign exchange inflows have increased by about 871 per cent in four years, as improved dollar supply and stronger foreign investor participation create room for some commercial banks to raise international spending limits on naira-denominated cards.

Central Bank of Nigeria (CBN) data showed that net FX inflows rose from $950 million in 2022 to $9.22 billion in January 2026.

The January figure was almost three times the $3.11 billion recorded in December 2025, while aggregate foreign exchange inflows increased by 45.24 per cent to $12.23 billion from $8.42 billion in the preceding month.

Lower foreign exchange outflows also contributed to the stronger net inflow position.

The improvement is reflected in changes to international card services. After years of restrictions during periods of severe dollar scarcity, some banks are now allowing customers to spend more on overseas purchases, travel, subscriptions and other international payments using naira-denominated cards.

THE ISSUES

Stronger foreign capital inflows, higher crude oil prices and improving investor confidence have supported the recovery in foreign exchange supply.

Foreign portfolio investments rose to $15.8 billion in the first nine months of 2026, compared with $12.2 billion in the corresponding period of 2025.

Nigeria’s external reserves also increased by a cumulative $6.5 billion over five months, reaching $54.9 billion at the end of September 2026.

Analysts at Quest Merchant Bank said sustained foreign capital inflows, higher oil prices and improving investor confidence had helped moderate exchange rate volatility.

They said stronger dollar supply had eased pressure from demand and supported the naira, despite global uncertainty and geopolitical tensions in the Middle East.

The World Bank also ranked the naira among the better-performing non-CFA African currencies in the second quarter of 2026, despite volatility linked to the Middle East conflict.

However, the growing contribution of foreign portfolio investments raises questions about how durable the improvement will be. Unlike long-term investments in productive assets, portfolio funds can leave the country quickly when investors reassess risks or global financial conditions change.

The International Monetary Fund has warned that excessive dependence on such investments exposes economies to sudden capital reversals.

Quest Merchant Bank analysts expect the naira to trade within a relatively narrow range in the near term, supported by foreign exchange liquidity. They nevertheless expect demand-side pressures to remain.

BANKS EXPAND INTERNATIONAL SPENDING LIMITS

The improvement in dollar availability has allowed some commercial banks to increase the amount customers can spend internationally with naira cards, although the limits vary considerably between lenders.

FirstBank has raised its international spending limit to $50,000 per quarter, while Guaranty Trust Holding Company (GTCO) has increased its quarterly limit to $40,000, according to customer notifications seen by BusinessDay.

Zenith Bank allows international transactions of up to $50,000 annually on its naira cards. Access Bank offers different limits depending on card category, including up to $50,000 annually on its special STMD prepaid card.

Other banks maintain lower limits. United Bank for Africa publishes a monthly international online and point-of-sale spending limit of $1,000 on its standard naira debit cards, while Fidelity Bank’s announced limit is $1,000 quarterly.

Stanbic IBTC’s official card FAQ lists a $100 monthly international spending limit, while Providus Bank offers $1,000 monthly on its Classic Naira Mastercard.

The differences show that improved foreign exchange supply does not translate into equal access to international spending across the banking industry.

WHAT’S BEING SAID

Ayodeji Ebo, Chief Executive Officer of MDU Capital, said banks could offer similar exchange rates but maintain different international spending limits because their sources of foreign currency and available dollar balances differ.

“Beyond the CBN, banks source dollars from customers such as exporters, through remittance flows and from the interbank market. The volume and cost of those dollars vary by bank. Each bank also has a different FX position, so how much it can commit to settling international card payments depends on its liquid dollar assets and other obligations,” he said.

Tunde Abidoye, Head of Research at Quest Merchant Bank, also attributed the differences in spending limits to variations in banks’ sizes, access to foreign exchange and liquidity positions.

He said the volume of foreign currency available to each lender determined how much it could commit to international transactions.

WHAT’S NEXT

Foreign portfolio investments, oil receipts and diaspora remittances are expected to remain important sources of foreign exchange supply.

However, the sustainability of the recovery will depend partly on whether Nigeria can maintain these inflows and reduce its exposure to sudden withdrawals by foreign investors.

For bank customers, the extent to which international spending limits improve will continue to depend on individual lenders’ ability to access and settle dollar transactions.

BOTTOM LINE

Nigeria’s stronger foreign exchange inflows have helped ease pressure on the market and given some banks room to restore higher international card limits. However, the uneven limits across lenders show that improved dollar supply has not translated into equal access for all customers, while reliance on foreign portfolio investments leaves the recovery exposed to shifts in global investor sentiment.