By Mohammed Bello Doka
In a decisive move aimed at enhancing currency control and regulation within Nigeria's financial landscape, the Central Bank of Nigeria (CBN) has mandated that international money transfers facilitated by operators such as Western Union, MoneyGram, Rapidtransfer, Ria, and other CBN-approved International Money Transfer Operators (IMTOs) will now be disbursed solely in naira. This directive, outlined in a circular dated January 31, 2024, represents a significant departure from previous practices and underscores the CBN's commitment to fostering financial stability and transparency.
According to a notice issued by Ecobank Nigeria, recipients of international transfers will receive their funds in naira either through bank account deposits or in cash, with the latter option applicable only for transfers below $200. Transactions exceeding this threshold must be credited directly to the recipient's bank account, ensuring greater transparency and traceability of funds.
In adherence to the CBN's guidelines, individuals collecting cash transfers below $200 must provide valid means of identification, including an International passport, Driver’s license, National Identity card, or INEC Permanent Voters Card (PVC). This requirement aims to enhance security and prevent fraudulent transactions while facilitating the smooth processing of international remittances.
Furthermore, the CBN has imposed strict restrictions on IMTOs, limiting their operations exclusively to inbound transfers and prohibiting outbound transactions. This regulatory measure seeks to streamline the flow of foreign currency within Nigeria's financial system and mitigate currency speculation and hoarding among domestic banks. By consolidating the handling of international transfers under the purview of authorized IMTOs, the CBN aims to enhance oversight and ensure compliance with anti-money laundering and counter-terrorism financing regulations.
In addition to these changes, the CBN has taken decisive action to curb the role of banks and fintech companies in facilitating international money transfers. The prohibition on offering such services aims to safeguard the integrity of Nigeria's financial system and prevent illicit financial activities. While acknowledging the importance of fintech innovation in driving financial inclusion and efficiency, the CBN remains steadfast in its commitment to maintaining stability and transparency in the foreign exchange market.
This shift in payment methods for international transfers underscores the CBN's proactive approach to addressing emerging challenges and strengthening the resilience of Nigeria's financial ecosystem. By mandating the conversion of international transfers into naira and implementing stringent regulatory measures, the CBN seeks to safeguard the country's monetary sovereignty, promote economic development, and foster trust and confidence in the financial sector.
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