The US dollar is one of the world’s most common currencies; and it is used in numerous countries. It is therefore important to obtain a dollar card instead of the local currency card.
Exchange rate
You don’t need to bother about the exchange rate your bank will charge you. According to www.moneyuk.com, one of the biggest financial issues most travellers face is the exchange rate. Intending travellers often ask whether they should change all the naira cash with them into dollars at the beginning and swallow up the commission charges or hold some back and hope that the exchange rate will improve.
By opting to have your cash already converted into dollars and paid into your domiciliary account, you don’t need to worry about exchange rate fluctuation.
In addition, one of the biggest problems that occur when paying for transactions abroad is opting to have the purchase debited in pound sterling. By using dollar debit cards instead, you will pay the same price that you saw on the shelf.
Transaction fees
Most banks do not charge any transaction fee on the dollar debit card. Exchange rate isn’t the only factor that can influence how much money you have to spend.
Global acceptability
The dollar is a global currency. It is therefore accepted everywhere. You are not likely to be stranded.
Payment for sundry expenses
It can be for hotel or air ticket bills. Paying for your hotel bill or airline tickets will become easier.
Entry visa fees
Some Nigerian bank customers are unable to pay for the UK and Canadian visas online. But with a dollar card, such challenge will no longer be there.
Features Of Dollar Debit Card
Events in the last few days have thrown up the need for a dollar debit card for certain categories of customers, especially those who for one reason or the other must carry out transactions denominated in dollars, pound sterling, euro or any other foreign currency.
Deposit Money Banks on Friday stopped the usage of their naira debit cards (Automated Teller Machine cards) abroad. They also stopped online transactions denominated in foreign currencies. A few banks that allowed online transactions only gave a limit of $100 per month.
The development has made intending travellers applying for visa to the United Kingdom and Canada to experience challenges in making payment for visas. They are also finding it difficult to book for foreign hotels online using their naira debit card or credit card.
Many customers, especially those who travel often or have things to do with foreign currencies, have been besieging banks to get the dollar card.
What is a dollar debit card?
A dollar debit card, in simple terms, is a debit card that does transactions in dollar instead of naira. It is the dollar equivalent of a naira debit card.
While the naira debit card transactions are done in naira, the dollar debit card transactions are done in dollars. A naira debit card is attached to your savings account or current account; but the dollar debit card is attached to your domiciliary account (a foreign currency account).
A dollar debit card is an international debit card that is issued in partnership with MasterCard or Visa; and it is directly linked to the customer’s domiciliary account. Banks including those in Nigeria have some similar products (prepaid dollar cards) that are not linked to a domiciliary account. They are different from the dollar debit card. The dollar debit card is denominated in the US dollars, but can also be used to settle purchases in other major currencies. All transactions carried out using the dollar card are reflected on the account instantly.
It is important to note that a customer can choose to apply for a pound sterling debit card or a euro debit card, depending on his/her needs or preferences. Most people open dollar debit card because the US dollar is the most popular currency in the world and transactions done in dollars are easily convertible to other currencies.
The following are features of a dollar card:
Accessibility: Customers can access their funds 24 hours worldwide.
The card has international use only. However, it may be used in Nigeria for online payments.
It can be used on the ATM terminals, PoS and websites that accept Visa or MasterCard.
Worldwide acceptance: The dollar card is acceptable worldwide across the ATMs, PoS terminals and the Internet.
Convenience: It makes life convenient. It can be used to book for hotels, buy airline tickets, among other things.
Affordability: Most banks issue the dollar card for a token of $7 or $8.
Security: The card uses Chip and PIN technology to prevent unauthorised transactions.
Cardholder’s name, number and expiry date are printed on the front of the card.
The three-digit Card Validation Value (CVV2) is printed on the other side of the card, beside the signature panel.
Four disadvantages of a dollar debit card
Dollar scarcity:
Due to the scarcity of dollars in the country, you may need to go to the parallel market to source for dollars to fund your domiciliary account. This often comes at a high exchange rate.
Account maintenance fee:
You will need to pay an annual account maintenance fee on your domiciliary account
Card maintenance fee:
Your bank will also charge you an annual card maintenance fee
Withdrawal fee on your domiciliary account:
Each time you withdraw cash from your domiciliary account across the counter for one reason or the other, your bank charges you a withdrawal fee.
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