The Central Bank of Nigeria (CBN) has barred international money transfer operators (IMTOs) from paying Nigerians in US Dollars.
Nigerians who hitherto received diaspora remittances in Dollars will no longer be able to.
TheNewsGuru.com (TNG) reports the IMTOs have started implementing the CBN’s new requirements for international money transfer operations already.
The IMTOs as a result have updated features on their apps for Nigerians resident abroad who wish to remit foreign currency back home.
Based on the new rule, Nigerians resident abroad are now only allowed to transfer the equivalent USD amount in Naira.
The IMTOs, including WorldRemit, Sendwave, amongst others, have started notifying customers about the implementation.
A WorldRemit’s notice to customers reads: “We can no longer support transfers in USD – only in Naira. If you’re about to send money to Nigeria – this is important.
“The Central Bank of Nigeria (CBN) has directed that it’s no longer possible for any money transfers to be paid out in USD in Nigeria”.
A similar notice by Sendwave reads: “In compliance with a recent directive from the Central Bank of Nigeria (CBN), we regret to inform you that Sendwave, along with all money transfer operators, is no longer able to support USD transfers to Nigeria. We’d encourage you to switch to sending Naira transfers instead”.
TNG reports the development is in compliance with CBN’s recent revised guidelines on international money transfer operations.
Recall that the CBN had earlier instructed banks to begin paying Dollars and other foreign currency payouts from abroad in Naira to boost forex supply.
“All inbound money transfers to Nigeria shall be paid to beneficiaries in Naira through a bank account, or cash.
“Proceeds of IMTO more than the equivalent of $200 shall be paid through an account.
“Cash payments shall be made upon the provision of a satisfactory/acceptable means of identification.
“Where the beneficiary does not have an account with the IMTO agent bank, the agent bank shall credit the beneficiary account in another bank.
“The exchange rate for the Naira payment shall be at the prevailing rate in the Nigerian Foreign Exchange Market,” the CBN guideline reads in part.
TNG reports IMTOs are CBN-authorised companies or organisations that facilitate fund transfers from individuals or entities residing abroad to recipients in Nigeria.
These operators help individuals to send money to their families, friends, or business partners in Nigeria.
Over 40 authorised IMTOs operate in Nigeria, including major international money transfer companies such as Western Union, MoneyGram, PayPalRia Financial, TransferWise, WorldRemit and others.
Earlier, CBN had dramatically increased the application fee for licensing IMTOs by 1,900%, from N500,000 to N10 million.
The apex bank’s decision was disclosed in a CBN document dated Wednesday, January 31, 2024, which also outlined the revised guidelines for IMTO operations.
“All banks are prohibited from operating International Money Transfer services but can act as agents,” the document stated.
Prospective IMTOs seeking to operate in Nigeria are now required to submit applications with a non-refundable fee of N10 million to the Director, Trade and Exchange Department.
The document listed several prerequisites for the application, such as approval to operate in other jurisdictions, evidence of tax clearance, and incorporation documents for indigenous IMTOs.
In addition to the application fee, IMTOs will be subject to an annual renewal fee of N10 million, or as specified by the CBN, to be paid via electronic transfer or bank draft by January 31 each year.