CBN Frowns At Operators Paying Remittances in Local Currency

Wednesday, December 16, 2020 / 8:12 PM / by CBN /  Header Image Credit: Nairametrics

Following the recent policy pronouncements on amendments to procedures for receipt of diaspora remittances, the Central Bank of Nigeria (CBN) notes material compliance by majority of market participants as beneficiaries of remittances through IMTOs now receive foreign currency through their designated banks. However and regrettably, a few operators continue to pay remittances in local currency contrary to the regulatory directive. The CBN frowns at this practice.

In the light of this, the CBN hereby provides the following additional operational guidelines: 

1. Switches and Processors should immediately cease all local currency transfers in respect of foreign remittances through IMTOs.
2. All MMOs are required to immediately disable wallets from receipt of funds from IMTOs.
3. Payment service providers are directed to cease integrating their systems with IMTOs going forward and must prevent comingling of remittances with other legitimate transactions.
4. All IMTOs are required to immediately disclose to beneficiaries that they exercise discretion to receive transfer in foreign currency cash or directly into their domiciliary accounts.
5. 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.

All licensed institutions are required to comply with the foregoing guidelines as contraventions will attract stiff regulatory sanction including revocation of license.

The CBN remains committed to promoting transparency in the administration of diaspora remittances into Nigeria and will continue to enforce policies that will stabilize and deepen the Nigeria foreign exchange market.

Credits

* This circular was first published on the website of the Central Bank of Nigeria on Wednesday, December 16, 2020.

Related News

1. CBN Re-Amends Circular on Procedures for Receipt of Diaspora Remittances
2. CBN Amends Procedures for Receipt of Diaspora Remittances
3. CBN Announces Applicable Exchange Rate for the Disbursement of Proceeds of IMTOs
4. Licensing of Interested International Money Transfer Operators (IMTOs) on-going
5. CBN Licenses New International Money Transfer Operators
6. Beware of Unregistered Money Transfer Operators

Related News - CBN Circulars and Publications

1. CBN Approves New Licence Categorisations for The Nigerian Payments System
2. CBN Provides Clarifications on the Operations of Export Proceeds and Ordinary Domiciliary Accounts
3. CBN Clarifies That 'Form M' May Be Processed for Purchases Made Through Third-Party Agents
4. CBN Clarifies Destination Payment for All Forms M, Letters of Credit and Other Forms of Payment
5. Manufacturing PMI Stands at 50.2% in November 2020 from 49.4% in October 2020
6. CBN Issues Guidelines for the Private Sector-Led Accelerated Agriculture Development Scheme
7. CBN Financial Markets Dept Releases 2019 Activity Report
8. CBN Removes the Restriction on Non-Member Mortgage Lenders from Refinancing
9. CBN Releases Framework for the Operation of the NIRSAL MfB Window of the N-YIF
10. Manufacturing PMI Stands at 49.4% in October 2020 From 46.9% in September 2020