IMTOs to pay out proceeds using I&E window rate –CBN
•Approves 5 additional operators to facilitate diaspora remittances •Naira closes N746/$1
By Chinwendu Obienyi
The Central Bank of Nigeria (CBN) has directed that all International Transfer Money Operators (IMTOs) to pay out proceeds using the Investors and Exporters’ (I&E) window FX rate as the anchor rate on the day of the transaction.
This was even as the apex bank approved the addition of five additional IMTOs to facilitate diaspora remittances. The directive was contained in a circular dated July 10, 2023, and signed by Director, Trade and Exchange Department, CBN, O.S. Nnaji.
IMTOs accept cash for the purpose of transmitting to persons’ resident in Nigeria or another country. They also carry out cross-border transfer services for personal purposes such as money transfer services towards family maintenance and money transfer services for foreign tourists visiting Nigeria
The circular which was addressed to Deposit Money Banks (DMBs), IMTOs and the general public, stated that, “Further to the circular referenced TED/FEM/FPC/GEN/01/011 dated November 30, 2020, IMTOs are required to pay out the proceeds using the Investor & Exporter’s window rate as the anchor rate on the day of the transaction.
It said that with immediate effect, Naira will now be a payout option for receipts of proceeds of IMTOs.
The circular said, “Accordingly, all recipients of diaspora remittances through the CBN-approved IMTOs on the attached list shall henceforth have the option of receiving naira payment in addition to USD and eNaira as payout options. This regulation takes effect immediately. Please note and ensure compliance”.
The CBN updated its list of registered IMTOs in the country. It will be recalled that the list was extended from 57 IMTOs in April 2021 to 62. The five additional IMTOs approved by the CBN are CSL Pay Limited, e-2-e Pay Limited, LeadRemit Limited, Lycamoney Financial Services Limited, and SimbaPay Limited.
Meanwhile, the disparity between the official and parallel market rate continued as the Naira stood at N746/$1 at the I&E window while it closed at N812/$1 at the parallel market. This is according to information obtained from FMDQ as well as AbokiFX.
A series of policy moves to unify Nigeria’s exchange rate have been welcomed by the markets, but without the CBN injections, the naira has been fluctuating over the past two weeks, trading between N750 and N790 on Wednesday, when it reached a high of 782.36/$1 at its highest levels on the official market.
However, it fell to N746/$1 while the Naira rose to N812/$1 from N810/$1 recorded at the parallel market on Wednesday. Reacting to the development, market analysts say the Naira will not deviate much from current levels until there is more clarity on CBN’s monetary policy.
