The Central Bank of Nigeria (CBN) has issued additional guidelines to International Money Transfer Operators (IMTOs) and Payment Service Providers (PSPs) clarifying some misunderstanding of some of the players about its recent policy pronouncements on Diaspora remittances.
The apex bank, in a circular with Reference No PSM/DIR/CON/CWD/16/119 dated December 16, 2020 titled ‘Receipt of Diaspora Remittances: Additional Operational Guidelines’ signed by its Directors in Trade and Exchange and Payment Management System Departments, noted that while majority of the IMTOs and PSPs had continued to comply with its recent policy pronouncements on amendments to procedures for receipt of Diaspora remittances, some were still paying remittance in local currencies contrary to its directive.
To reverse the ugly trend, the CBN now directed that Switches and Processors should immediately cease all local currency transfers in respect of remittances through IMTOs; all MMOs are immediately required to disable wallets from receipts of funds from IMTOs; payment service providers are directed to cease integrating their systems with IMTOS going forward and must prevent comingling of remittances with other legitimate transactions.
In addition, the apex bank directed that all IMTOs are required to immediately disclose to beneficiaries that they exercise discretion to receive transfer in foreign currency cash or directly into their domiciliary accounts; and that a central reporting portal for all foreign remittances to be managed by the Nigeria Interbank Settlement System (NIBSS) is currently under development to improve visibility of foreign remittances flow.
The CBN maintained that all licensed institutions are required to “comply with the foregoing guidelines as contraventions will attract stiff regulation sanction including revocation of licence”.
This is even as it restated its commitment to promoting transparency in the administration of Diaspora remittances into the country and determination to enforce policies that will stabilize and deepen the Nigerian foreign exchange market.