Remittances: NIDCOM Hails Tinubu’s Administration, CBN On Naira Payout
Hon. Abike Dabiri-Erewa, Chairman/CEO, Nigerians
in Diaspora Commission (NIDCOM) has commended the new payout policy of
the Central Bank of Nigeria (CBN) as a boost to diaspora remittances
describing it as a further encouragement for Diaspora Remittances by the
new Administration of President Bola Ahmed Tinubu.
Relations of the Commission, Dabiri-Erewa added that the approved Naira
payouts will equally motivate Nigerians in the Diaspora to send more
money back home for developmental projects as against consumables.
The NIDCOM Boss noted that with the new CBN policy people can get open
market rates instead of just official rates when they send money through
the bank from abroad.
Nigeria’s Central Bank has approved Naira payout for diaspora
remittance, ending a ban that had been in place since December 2020.
In a circular dated July 10, 2023, Nigeria’s Central Bank approved the
payment of the Naira to beneficiaries of diaspora remittance.
The circular means that banks and International Money Transfer
Operators (IMTOs) can now pay their recipients in Naira, ending a
three-year ban.
In December 2020, the CBN banned banks and IMTOs from paying recipients
in Naira. The policy also stated that only banks could transfer funds
onward to recipients.
In theory, the CBN policy ended the business model of many digital
remittance companies that allowed Nigerians abroad to send money
directly to the Naira accounts of recipients.
Months after the “Naira payment ban,” the CBN introduced the Naira for
Dollar Scheme in March 2021. These policies were part of Godwin
Emefiele’s attempts to encourage diaspora remittances to move through
formal channels and boost Foreign Exhange liquidity.
The bank hoped to squeeze unlicensed IMTOs out of business by insisting
on paying recipients foreign currency.
This recent policy removal is another step towards loosening the strict
control the CBN has exercised over Foreign Exchange rates in the last
five years.
It’s also great for customers who can now choose between receiving
their funds in foreign currency, eNaira and the Naira. Customers who
choose to receive their funds in Naira will be paid using the Investors
& Exporters Window rate on the day of the transaction.
According to World bank reports, Nigerian Diaspora community remitted
$168.33 billion to the country in the past eight years between 2015 to
2022.
