The Central Bank of Nigeria (CBN) has ordered International Money Transfer Operators (IMTOs) to begin payment of remittances to beneficiaries in both Naira and foreign exchange (FX).
Similarly, the apex bank also directed that the Investors and Exporters’ (I&E) window FX rate should be used in determining the exchange rate for Naira pay-outs.
The CBN, in a circular with reference number FED/FEM/PUB/FPC/001/004 dated July 10, 2023 and issued by the Director of Trade and Exchange. Dr. Ozoemena Nnaji, stated that the decision was in furtherance to an earlier circular dated November 30, 2022 with reference number FED/FEM/FPC/01/011, which provided guidelines on the payout policy of diaspora remittances to beneficiaries.
While the November 30, 2022 circular introduced the payment of dollars to beneficiaries of diaspora remittances through the designated bank of their choice and with unrestricted access to their funds, the latest circular indicated that the Naira payment was an option in addition to United States dollars and E-Naira in receiving diaspora remittances.
The Circular reads: “Further to the circular referenced FED/FEM/FPC/01/011 dated November 30, 2022 in respect of the above subject, the Central Bank of Nigeria hereby announces Naira as a payout option for receipts of proceeds of International Money Transfers.
“Accordingly, all recipients of Diaspora remittances through the CBN-approved International Money Transfer Operators (IMTOs) on the attached list shall henceforth have the option of receiving Naira payment in addition to USD and e-Naira as payout options.
“For the avoidance of doubt, IMTOs are required to pay out the proceeds using the Investors’ & Exporters’ window rate as the anchor rate on the date of the transaction. The regulation takes effect immediately”, the apex bank added.
It would recalled that the apex bank had, on June 14, announced the unification of all segments of the Nigerian FX market by collapsing all windows into the I&E window and directed the banks to allow the FX rate to be determined by market forces.