Banks to open dollar account to allow foreign remittances says CBN

The Central Bank of Nigeria (CBN) has issued a directive directing all commercial banks to allow the opening of new dollar accounts with offshore lenders for receiving international money transfers.

Banks to open dollar account to allow foreign remittances says CBN

This new development is well-considered two months after the CBN made a policy mandating IMTOs to pay diaspora remittances beneficiaries in dollars is being rejected. Also followed, is the regulation that all mobile money operators should disable wallets from receipt of funds from IMTOs.

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Banks to open dollar account to allow foreign remittances says CBN

Godwin Emefiele, the Central Bank of Nigeria (CBN) Governor analysed data on IMTOs inflows into the country over the past year. After thorough investigations were made, it can be seen that some IMTOs resorted to engaging in arbitrage arrangements on the naira-dollar exchange rate instead of identifying ways to improve transaction volumes and create more enabling ways for Nigerians in the Diaspora to remit funds. This act resulted in a significant drop in-flows into the country.

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Besides, Emefiele does not encourage the use of unofficial channels. Channels which supported diversion of remittance flows meant for Nigeria, thereby undermining Nigeria’s Foreign Exchange management framework are unsafe to use.

The information was disclosed by WorldRemit, an International Money Transfer Operator (IMTO) player to its clients. WorldRemit responded to the new policy saying that it welcomed the CBN announcement that all Nigerian banks will be mandated to facilitate money transfers by automatically opening US Dollar bank accounts for customers who do not currently have US Dollar bank accounts.

This means that all international money transfers will be successfully processed even if the money is sent to a Naira account. However, a $2,000 withdrawal limit will apply to these accounts.

Gbenga Okejimi, WorldRemit Country Manager for Nigeria and Ghana, said:

“We are very pleased by the CBN’s decision to mandate Nigerian banks to help citizens who do not have a USD account by automatically providing this facility on their behalf. This development will make all the difference to those who receive support from family and friends abroad”.

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