The Central Bank of Nigeria (CBN) issued additional guidelines for individuals seeking foreign exchange for medical expenses, school fees, and basic travel allowance.
These individuals are now directed to obtain foreign exchange from the Investors’ and Exporters’ (I&E) window.
In a press statement following the CBN’s announcement on June 14, 2023, regarding new guidelines in the foreign exchange market, an extraordinary Bankers’ Committee meeting was convened on Friday, June 16, 2023, to discuss the implementation and implications of these guidelines for the banking public.
Dr. Isa Abdulmumin, the Director of Corporate Communications, stated that the CBN, taking into account the discussions at the meeting, has provided further guidance to Deposit Money Banks (DMBs).
These guidelines issued by the CBN are aimed at improving transparency, liquidity, and price discovery in the foreign exchange (FX) market.
The goal is to enhance the supply of foreign exchange, discourage speculation, build customer confidence, and ensure overall stability in the FX market.
Under these guidelines, individuals seeking foreign exchange for medical expenses, school fees, and basic travel allowance (BTA) are directed to obtain them from the Investors’ and Exporters’ (I&E) window.
Deposit Money Banks (DMBs) are instructed to promptly process eligible invisible transactions on behalf of their customers using the applicable exchange rate at the I&E window.
Ordinary domiciliary account holders are granted unrestricted access to funds in their accounts. They are permitted to use cash deposits up to USD$10,000 per day or its equivalent through telegraphic transfers. DMBs are required to provide returns to the CBN, including the purpose of such transactions.
The guidelines also state that cash deposits into domiciliary accounts will not be restricted, as long as DMBs comply with the necessary Know Your Customer (KYC) procedures, due diligence, and adhere to anti-money laundering and counter-terrorism financing (AML/CFT) laws and regulations.
Furthermore, the CBN emphasizes its commitment to settling committed FX forward transactions in an orderly manner to boost market confidence.
The bank also plans to normalize its Cash Reserve Ratio (CRR) maintenance processes and ensure equitable implementation across the banking industry.
The CBN intends to maintain engagement with stakeholders and provide further guidance as it continues to implement ongoing reforms in the foreign exchange market
