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International money transfer operators to pay in Naira

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Following the recent directive by the Central Bank of Nigeria (CBN), restricting the operations of International Money Transfer Operators (IMTO) to only inbound transfers, the operators have decided to halt dollar transfers to Nigerians.

The IMTOs said they would now only pay in Naira.

In the recently published document addressed to IMTOs, on 31st January, the CBN ordered the operators not to facilitate money transfers from Nigeria to other countries.

The apex bank described the new directive as a move to “liberalise the foreign exchange market and ensure transparency”.

Despite a devaluation last year and a decision to float the Naira, the currency has witnessed even more volatility as the CBN attempts to clear foreign exchange backlogs worth about $7 billion.

The old guidelines dated 6 September 2014 did not provide a clear definition of IMTOs. The definition was implied from the permissible activities that the operators could undertake however, under the New Guidelines, IMTOs are defined as companies approved by the CBN to facilitate the transfer of funds from individuals or entities residing abroad to recipients in Nigeria and the payment of a corresponding sum to a beneficiary through a clearing network to which the IMTO belongs.

However, under the revised guidelines, the IMTO services are now limited to inbound money transfer services alone. This means that IMTOs are only able to provide money transfer or remittance services from a foreign country into Nigeria.

The apex bank asked IMTOs to quote exchange rates for Naira payout to beneficiaries based on the prevailing market rates at the nation’s official foreign exchange market.

In a bid to implement the CBN’s directive, One of the approved IMTOs, World Remit, has updated its app for Nigeria with the following instructions: WorldRemit Nigeria News! 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 has directed that it’s no longer possible for any money transfers to be paid out in USD in Nigeria. So, of course, this includes WorldRemit money transfers.

“But please don’t worry. You can still enjoy the same quick, safe, and affordable World Remit service to Nigeria by sending money in Naira instead”, it stated.

Another operator, simply known as Sebdwave said: “In compliance with a recent directive from the Central Bank of Nigeria, 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”.

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