CBN stops payment of remittances in dollar
• IMTOs to open naira settlement accounts By Nduka Chiejina and Collins Nweze Beneficiaries of diaspora remittances will no longer be able to collect money sent to them in dollar
• IMTOs to open naira settlement accounts
By Nduka Chiejina and Collins Nweze
Beneficiaries of diaspora remittances will no longer be able to collect money sent to them in dollar or any other foreign currency. It will only be in Naira.
The Central Bank of Nigeria (CBN) yesterday issued this directive which will take effect on May 1.
To give effect to this new order, the Apex bank directed all International Money Transfer Organisations (IMTOs) to open naira settlement accounts.
With these, the operators are to henceforth route all remittance transactions through the naira settlement accounts.
The CBN stated that the latest policy was aimed at deepening diaspora remittances while improving transparency, traceability, and monitoring of foreign exchange (forex) flows.
In a circular signed by Musa Nakorji, CBN’s Director of Trade and Exchange Department, the apex bank stated that the directive encompasses all transactions related to international money transfers, including disbursements to beneficiaries and other settlements.
“All IMTOs are hereby directed to open naira settlement accounts and ensure that all transactions are routed strictly through their designated settlement accounts, maintained with authorised dealer banks (ADBs) in Nigeria,” CBN stated.
The apex bank said all transactions must be processed exclusively through the designated accounts.
According to CBN, IMTOs may designate existing accounts or open new ones and are allowed to operate multiple settlement accounts across different dealer banks.
The CBN also directed IMTOs to notify its trade and exchange department of all designated settlement accounts and provide updates when necessary.
To enhance market efficiency, the apex bank stated that the authorised dealer banks may process foreign currency transfers from IMTO settlement accounts to other authorised dealers and approved participants, including bureau de change (BDC) operators.
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On pricing, the apex bank instructed IMTOs to benchmark their rates against real-time market prices on Bloomberg’s BMatch platform.
CBN stated: “IMTOs shall observe real-time market prices from the Bloomberg BMatch and utilise this as guidance for pricing transactions with their customers and authorised dealers”.
The apex bank stated that the move would improve price discovery, reduce information asymmetry, and encourage participation in the official forex market.
The regulator also reminded the IMTOs to comply with anti-money laundering, combating the financing of terrorism, and counter-proliferation financing (AML/CFT/CPF) requirements, while maintaining proper records for audit and regulatory review.
The new directive builds on earlier reforms introduced by the CBN on January 31, 2024, which provided updated guidelines for the licensing and operations of international money transfer services in Nigeria.
The apex bank stressed that all IMTOs must comply fully with the new rules and maintain proper records of their transactions for regulatory checks and audit purposes.
It also reminded operators to continue to meet required standards on anti-money laundering, combating the financing of terrorism, and counter-proliferation financing, as part of efforts to safeguard the integrity of Nigeria’s financial system.
The move is part of broader efforts by the CBN to strengthen foreign exchange inflows from Nigerians in the diaspora, improve transparency in the system, and ensure that remittance transactions contribute more effectively to the country’s economic stability.
