Do you send money to Nigeria from abroad? If yes, you must thoroughly read this article. Nigeria continues to be the region’s largest remittance receiver and the seventh-largest within low and middle-income countries (LMICs), with estimated remittances of about $21.7 billion, down more than $2 billion from 2019.
According to a PwC survey, the Nigerian exodus sent about $25 billion in remittances back home in 2018, a figure that is expected to rise in the coming year as many Nigerians continue to work and develop businesses in both their home country and other countries. By 2023, PwC estimates that the total will be close to $35 billion. Nigeria continues to be a force to be reckoned with in many sectors of the African economy, with Egypt alone beating Nigeria to the top spot for these remittance figures in 2018. The significance of remittances cannot be overstated, notably because they account for 6.1 percent of GDP.
What Are The Key Points Of New Regulation Every expatriate Must Understand?
For starters, the remittance figures listed above may be higher, but inequalities are to be anticipated since the number of money transfer to Nigeria occur through informal channels. The Nigerian Central Bank is well aware of this and has long worked to improve the sector’s performance. The regulator issued a circular in November 2020, stating that remittances will only be accepted in USD cash or domiciliary (US dollar) accounts.
The CBN clarified the first circular in subsequent circulars, stating that:
- Only approved IMTOs (International Money Transfer Operators) will facilitate transactions into these domiciliary accounts.
- All remittances must be in foreign currency.
- No International money transfer service provider will be permitted to send Naira remittances.
Something To Remember:
Apart from the above rules and regulations, as an expatriate, you can send money to Nigeria online through ACE money transfer with fee-free and the highest exchange service across the world.
What Will Be The Outcome Of New Legislation On Remittance In Nigeria?
These regulations had an immediate effect and are still causing ripples in the formal financial sector. So much so that, with the launch of the Naira 4 Dollar Scheme in March 2021, the CBN felt compelled to find ways to promote online money transfer to Nigeria or remittance. “All beneficiaries of diaspora remittances through CBN approved IMTOs shall be paid 5 Naira for every 1 USD received as remittance flow,” according to the new circular. This means that a dollar that last week was worth 412 would now be worth 417 at the official rate.