The Central Bank of Nigeria (CBN) has announced that procedures have been implemented to allow eligible international money transfer operators (IMTOs) to access naira liquidity through the official window.
According to a CBN circular issued on Monday, the new measures will increase local currency liquidity for the settlement of diaspora remittances.
They are also part of the regulator’s commitment to ensuring the smooth operation of foreign exchange (FX) markets and increasing remittance flows through formal channels, according to the circular.
The CBN said:
“…the Bank has implemented measures that will enable eligible International Money Transfer Operators (IMTOS) to access NGN liquidity at the CBN window. These measures are aimed at widening access to local currency liquidity for the settlement of diaspora remittances.”
“Therefore, eligible IMTO operators will be able to access the CBN window directly or through their Authorized Dealer Banks (ADBs) to execute transactions for the sale of foreign exchange in the market.”
The CBN has developed regulations to guide the process and ensure compliance, stating that “same-day settlement” will be accessible for transactions performed “before noon on a trading date”.
According to the bank, pricing on the CBN portal shall reflect NAFEX trading rates that are “observable on an acceptable market benchmark”.
“The operation of this market segment follows the existing arrangement in place for authorized dealers with Foreign Portfolio Investment participating in the primary market securities auctions,” the regulator added.
“Regulatory returns to be submitted to the CBN by all participants daily, are mandatory and this is expected to contain all the relevant information on the sources of funds.
“Participants in this segment are the IMTOS, Authorized Dealer Banks and CBN. This circular is with immediate effect.”