Central Bank of Nigeria (CBN) has issued further guidance on operational changes to foreign exchange market allowing Domiciliary account holders to use cash deposits or electronic transfer up to $10,000 per day.
However, Deposit Money Banks (DMBs) will have to provide returns to the CBN, including the “purpose” for the transaction.
A statement by the Director, Corporate Communications, Dr. Isa Abdulmumin provided Deposit Money Banks (DMBs) with additional guidance on the operational adjustments to the foreign exchange market that were announced on June 14, 2023.
It explained that the policy changes were aimed at promoting transparency, liquidity and price discovery in the FX market in order to improve FX supply, discourage speculation, enhance customer confidence and ensure overall stability in the FX market.
The CBN also removed restriction on cash deposits into domiciliary accounts after proper KYC and due diligence by the DMBs.
Other guidelines include
All visible and invisible transactions (medicals, school fees, BTA/PTA, airline and other remittances are eligible for the Investors’ and Exporters’ (I & E) window.
DMBs shall ensure expeditious processing of all eligible invisible transactions on behalf of their customers using the applicable rate at the I & E window.
The CBN will prioritize orderly settlement of any committed FX forward transactions as they fall due to boost market confidence further.
The Bank will normalize its Cash Reserve Ratio (CRR) maintenance processes and ensure equity in its implementation across the banking industry.
The statement added that the CBN would continue to engage stakeholders and issue further guidance as it implements the ongoing reforms.
RN
