CBN Orders Banks To Convert Foreign Currency Payments To Naira

Nigeria’s Central Bank (CBN) has mandated International Money Transfer Operators (IMTOs) to pay all recipients of foreign currencies, particularly the United States Dollar (USD), in Naira. The CBN, in revised guidelines for IMTO operations released on January 31, stated that IMTOs are only permitted to pay inbound transaction recipients in Naira. The exchange rate for these transactions will be determined by the current exchange rate.

“All inbound money transfers to Nigeria must be paid to beneficiaries in Naira through a bank account or in cash,” said the CBN. “The exchange rate will be based on the prevailing rate in the Nigerian Foreign Exchange Market.” The CBN also required IMTOs to disclose all charges and exchange rates used for converting payment transactions.

IMTOs confirmed the implementation in a notice to customers, stating that the CBN’s directive has resulted in changes to their services. “In compliance with a recent directive from the Central Bank of Nigeria (CBN), 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,” said the operator. Another IMTO, Worldremit, similarly announced that transfers would not be paid out in USD.

“If you’re planning to send money to Nigeria—this is important. The Central Bank of Nigeria (CBN) has directed that it’s no longer possible for any money transfers to be paid out in USD in Nigeria. So that, of course, includes World Remit money transfers,” stated the firm. “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.”

IMTOs are firms that accept cash for transmission to individuals residing in Nigeria or another country. They also provide cross-border transfer services for personal purposes, such as money transfer services for family maintenance and money transfer services for foreign tourists visiting Nigeria.