Beneficiaries of diaspora remittances to receive payment in dollars

01 Dec Beneficiaries of diaspora remittances to receive payment in dollars

The Central Bank of Nigeria (CBN) has announced that beneficiaries of diaspora remittances through the international money transfer operators (IMTO) shall now receive payment in foreign currency (US Dollar) through the designated bank of their choice and shall have unrestricted access to their funds.

The bank explained that  existing regulations which allow domiciliary account holders use of their funds for business operations only, will continue to be operated, with extra funds sold in the ‘Investors & Exporters’ (I&E) window.

In a statement signed by O.S. Nnaji, Director of Trade & Exchange of CBN, the bank said recipients of such remittances may have the option of receiving these funds in foreign currency cash or into their domiciliary account.

In another circular titled “Operation of domiciliary accounts,” it clarified that the above is for export proceeds domiciliary accounts, while for ordinary domiciliary accounts, ” where accounts are funded by electronic /wire transfer. Account-holders will be allowed unfettered and unrestricted use of these funds for eligible transactions.

“Where accounts are funded by cash lodgements, existing regulation will continue to apply.”

It further noted that these clarifications are necessary given the vastly improved capabilities of the CBN to monitor transactions, forestall money laundering and prevent the adverse effect of Dollarization in the economy.

“These changes are 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 would receive a market reflective exchange rate for the market.”