In a significant move, the Central Bank of Nigeria (CBN) has introduced the naira, the country’s legal tender, as a payout option for diaspora remittances.

This development offers recipients an additional choice alongside the existing options of receiving their proceeds in dollars or eNaira.

The directive, outlined in a circular dated July 10, 2023, and signed by O.S. Nnaji, Director of the Trade & Exchange Department at the CBN, provides clarity on the implementation of the new payout option.

The CBN specifies that the rate for the naira payout should be determined using the investors and exporters’ (I&E) window foreign exchange rate.

The circular, addressed to deposit money banks, international money transfer operators (IMTOs), and the general public, emphasizes that the inclusion of the naira as a payout option aligns with previous directives from the CBN, which aims to enhance the ease and flexibility of remittance transactions.

With immediate effect, recipients of diaspora remittances through CBN-approved IMTOs listed in the circular will have the choice to receive their payments in naira, USD, or eNaira. Notably, IMTOs are required to use the I&E window rate as the anchor rate for payout transactions.

In addition to expanding payout options, the CBN has approved the inclusion of five more IMTOs to facilitate smoother diaspora remittances.

These additional IMTOs, CSL Pay Limited, e-2-e Pay Limited, LeadRemit Limited, Lycamoney Financial Services Limited, and SimbaPay Limited, bring the total number of registered IMTOs in Nigeria to 62.

IMTOs play a crucial role in facilitating cross-border transfers for personal purposes, including family maintenance and financial services for foreign tourists visiting Nigeria.

Their registration and inclusion in the CBN’s list of approved IMTOs ensure compliance with regulations and foster secure and transparent remittance transactions.

This development by the CBN highlights the commitment of the Nigerian government to promote financial inclusivity and enhance the remittance landscape. The introduction of the naira as a payout option, along with the approval of additional IMTOs, reflects the evolving needs of recipients and aims to facilitate seamless remittance flows into the country.

As the CBN continues to implement policies that support diaspora remittances, it is essential for recipients and stakeholders to stay informed about the latest updates. This move towards providing more choices and enhancing the efficiency of remittance transactions is expected to have a positive impact on individuals and families relying on funds from abroad.