What CBN’s new policy on diaspora remittances means for naira to dollar exchange — Gwadabe

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Aminu Gwadabe, who holds the position of president in the Association of Bureaux De Change Operators of Nigeria, has endorsed the new diaspora remittance policy from the Central Bank of Nigeria.

Remember that the central bank instructed International Money Transfer Operators to process transactions via designated Naira settlement accounts.

To enhance price recovery, CBN instructed IMTOs to utilize Bloomberg BMatch for transaction pricing.

In a statement to ZINGTIE on Saturday, Gwadabe reacted by characterizing the new measures as a significant move toward liberalizing and democratizing the remittance market, emphasizing that the reforms would enhance transparency and bolster regulatory oversight.

He stated that the policy would tackle enduring problems of diversion and under-reporting of diaspora inflows, subjecting these transactions to closer scrutiny by the apex bank.

He emphasized the importance of allowing International Money Transfer Operators (IMTSOs) access to the Bloomberg B-Match trading platform, stating that this would remove bottlenecks, exclusivity, and monopolistic tendencies linked to remittance proceeds in the past.

Gwadabe commended the decision to establish Nigerian settlement accounts for IMTSOs with authorized dealer banks. He stated that the action would establish a centralized framework for remittance proceeds, thereby enhancing the oversight of the Central Bank of Nigeria and increasing foreign exchange liquidity to promote naira stability.

“The opening of settlement accounts will provide a centralization platform for the proceeds and enhance the CBN’s oversight function, while also generating higher FX liquidity for the naira,” he stated.

He added that the policy is anticipated to enhance price discovery in the foreign exchange market, diminish information asymmetry between IMTSOs and banks, and promote wider involvement in the official market, especially among bureaux de change operators.

Gwadabe conveyed hope that the reforms would eventually enhance the foreign exchange market and lead to a more efficient and transparent remittance system in Nigeria.

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