CBN Frowns On Operators Paying Diaspora Remittances In Naira
The bank says a few operators continue to pay remittances in local currency.
The Central Bank of Nigeria (CBN) has issued additional guidelines to prevent operators from paying diaspora remittances in local currency.
The apex bank had in November 2020 announced an amendment for beneficiaries of diaspora remittances through International Money Transfer Operators (IMTOs) to receive such inflows in foreign currency in cash through their designated banks, or into their ordinary domiciliary accounts.
However, the bank noted in a circular on Wednesday, December 16 that, despite material compliance by majority of market participants, a few operators continue to pay remittances in local currency.
To protect the integrity of the regulatory directive, the CBN issued five additional operational guidelines on Wednesday, including a requirement for switches and processors to immediately cease all local currency transfers in respect of foreign remittances through IMTOs.
Mobile Money Operators are also required to immediately disable wallets from receipt of funds from IMTOs; while payment service providers are directed to cease integrating their systems with IMTOs going forward, and must prevent comingling of remittances with other legitimate transactions.
The CBN also directed all IMTOs to immediately disclose to beneficiaries that they exercise discretion to receive transfer in foreign currency cash, or directly into their domiciliary accounts.
The apex bank said a central reporting portal for all foreign remittances to be managed by the Nigerian Interbank Settlement System (NIBSS) is currently under development to improve visibility of foreign remittance flows.
The bank said last month that the regulatory directive will deepen the foreign exchange market, provide more liquidity, and create more transparency in the administration of diaspora remittances.
– Pulse NG