Nigeria liberalises Diaspora remittances, recipients to collect money in dollars
By OLudare Mayowa
Nigerians receiving funds from their relatives abroad through money transfer operators such as Western Union and Moneygram now have the option of collecting such money either in local currency or foreign currency, the Central Bank of Nigeria (CBN) said on Monday.
In a circular issued by the regulatory bank on Monday and signed by its Director of Trade and Exchange, Ozoemena Nnaji, the bank said: “beneficiaries of Diaspora remittances through International Money Transfer Operators (IMTOs) shall henceforth receive such inflows in foreign currency (US dollar) through the designated bank of their choice.
“Such recipients of remittances may have the option of receiving these funds in foreign currency cash (US Dollars) or into their ordinary domiciliary account,” the bank said in the circular.
According to the regulatory bank, the changes were necessary to deepen the foreign exchange market, provide more liquidity and create more transparency in the administration of Diaspora remittances into Nigeria.
“In addition, these changes would help finance a future stream of investment opportunities for Nigerians in the Diaspora, while also guaranteeing that recipients of remittances would receive a market-reflective exchange rate for their inflows.
“All authorised dealers and the general public should note that beneficiaries shall have unfettered access and utilisation of such foreign currency [roceeds, either in cash and/or in their domiciliary accounts,” the CBN said.
Analysts said the move by the CBN was meant to curb pressure on the local currency on the parallel market, which closed at N500 to the dollar on Monday as dollar shortage persists in the economy.
The CBN had issued a circular effective from November 30, adjusting the exchange rate of the local currency at the IMTOs and bureau de change segments in a bid to align the domestic exchange market rates.
However, the market reacted to the CBN devaluation of the local currency with further depreciation on the parallel market on Monday, prompting the decision by the regulatory bank to increase dollar supply to the parallel market through diaspora remittances.