Sunday, 27 December 2015

Central Bank bans use of naira debit cards overseas- The Public Relations implications


The latest plan by the Nigerian Central Bank to ban the use of Nigerian debit cards outside the country has implications for the PR & communications industry in the country. 

THE Central Bank of Nigeria (CBN) on Monday ordered commercial banks to stop customers from using their debit and credit cards outside the country.
This will have hurricane effect on small businesses in Nigeria, Nigerian travellers, and definitely the Public Relations and entire communications landscape in Nigeria.

Following the latest development, banks are beginning to communicate the apex bank’s directive to customers through emails, noting that it is a “temporary measure”.
The directive, which takes effect from January 1, 2016, will no doubt affect access to foreign online retailers. The measure is seen as part of Federal Government’s efforts to obstruct the flow of foreign exchange out of the country following the intense pressure on the naira in the past week, crossing an all time high of over N280 to the dollar.

Already, the naira on Friday strengthened against the dollar after weeks of free fall at the parallel market, gaining N10 to exchange at N270 to a dollar.
The apex bank spent billions of dollars propping up the currency since it fixed the exchange rate in February and tightened trading rules to curb speculation.

It is not clear how many people will be affected by the latest measure but sources confirmed that Nigerians who travel abroad regularly and use their local cards for shopping and other transactions may be affected.

The international and local media are all trailing this story closely.
This new order has huge implications for the public relations and advertising industry in Nigeria, as well as the entire business landscape.
Firstly, most companies will also be hard pressed for dollars at this time. And there will be a push back to the PR and advertising industry for budget reviews and further squeeze on margins.

 

 
Access to foreign training and international knowledge will also be affected in the long run. Subscription to triage journals, international literature and attending specialized overseas PR training used to be payable using the Nigerian debit and credit card. That will change also.
Most of the banks will also have to quickly change the messaging in some of their advertising and PR campaigns that used to trumpet the fact that you can use your Nigerian debit and credit card wherever you go.

MasterCard, a leading global payments and solutions company, which envisions a world beyond cash and a cashless society p, especially in Nigeria, may also be taking another look at their service promise in the peculiar Nigerian market. Along with VISA, they can only cross their fingers with other businesses in Nigeria and hope that the newly imposed ban on the use of Nigerian debit cards abroad will be only temporal indeed.

But then good PR and good business is all about finding solutions to new problems. One will expect the Public Relations industry to find a creative way out!