The Central Bank of Nigeria (CBN) has finally ended the ban on diaspora remittances that has been in effect for the past three years, by approving naira payouts for such foreign remittals.
In a circular dated July 10, 2023, and signed by Director, Trade & Exchange Department, Dr. O.S. Nnaji, the CBN said it has approved the payment of the Naira to beneficiaries of diaspora remittance through the International Money Transfer Operators (IMTOs).
“The Central Bank of Nigeria hereby announces Naira as a payout option for receipts of proceeds of International Money Transfers,” the statement reads.
“Accordingly, all recipients of diaspora remittances through the CBN approved IMTOs on the attached list shall henceforth have the option of receiving Naira payment in addition to USD and eNaira as payout options.
“For the avoidance of doubt, International Money Transfer Operators are required to pay the proceeds using the Investors’ & Exporters’ Window rate as the anchor rate on the day of the transaction.”
With this policy twist, banks and IMTOs can now pay their recipients in Naira, ending a three-year ban since 2020.
This is intended to loosening the apex bank’s firm control has over FX rates in the last five years as it now allows customers to choose between receiving their funds in foreign currency, eNaira and the Naira.
The CBN’s circular entitled ‘Payout Option in Naira for Receipt of Proceeds of Diaspora Remittances’ also updated the list of registered IMTOs in Nigeria from 47 in 2021 to 62.
Recall that in December 2020, the CBN had in a policy statement it made banned banks and IMTOs from paying recipients in Naira adding that only banks could transfer funds onward to recipients.
