Foreign Remittance Threatened After CBN Ordered IMTO’s To Pay In Naira

International Money Transfer Operators, IMTOs, operating in Nigeria have notified their customers that they would no longer pay foreign remittances in dollar.

The notification is in compliance with the Central Bank of Nigeria, CBN, directive to that effect, the operators informed their customers through various messages seen by the magazine.

According to the details of the CBN guidelines, the Naira pay out will be based on official Importer and Exporter, I&E rates to the dollar.

For instance, Worldremit said in a notice to customers that based on the CBN directive “it’s no longer possible for any money transfer to be paid out in USD in Nigeria. But please don’t worry. You can still enjoy the same quick, safe and affordable WorldRemit service to Nigeria by sending money in Naira instead. If you have any questions or concerns, our dedicated support team is always here to help,” it said.

The magazine learned that other 62 IMTOs licensed by the CBN has sent similar messages to their customers as required by the apex regulatory authority.

Some of the authorized IMTOs operating in Nigeria include major international money transfer companies such as Western Union, MoneyGram, PayPalRia Financial, TransferWise, WorldRemit, PagaTech, Flutterwave, VFD, Interswitch, and others

The Yemi Cardoso-led CBN had during the week issued new guidelines to the operators, which financial analysts described as one of the last-ditch efforts to ensure stability in the foreign exchange market, as well as  saved the Naira from further depreciation.

Meanwhile, keen financial experts informed the magazine that the new directive by the apex bank to IMTOs to pay out dollars on foreign remittance at the official I&E rates may discourage Nigerians abroad from sending foreign currencies to their loved ones back home.

This may further reduce foreign remittances into the country, which experts insist has shrunk over the last few years due to some CBN policies considered by foreign remitters as disincentives.

Last year, Nigeria recorded the least direct remittance of the year over the past nine years  with less then a billion dollar in the first half of 2023.