Forex Crisis: CBN Issues Fresh Guidelines For International Money Transfer Operators

The Central Bank of Nigeria (CBN) has released updated guidelines for International Money Transfer Operators in response to the ongoing foreign exchange crisis in the country.

The apex bank disclosed this in a recent circular titled, ‘Reviewed Guidelines of International Money Transfers in Nigeria’, signed by the Director of Trade and Exchange, Hassan Mahmud.

The banker’s bank said with the reviewed guidelines, IMTOs shall not engage in any outbound transaction and buy foreign exchange from the domestic foreign exchange market for settlement.

It also prohibited all banks and financial technology companies from operating international money transfer services but can act as agents.

CBN pegged the minimum share capital of IMTOs as $1 million foreign and the equivalent for indigenous.

“All banks are prohibited from operating International Money Transfer services but can act as agents. Also, Financial Technology Companies are not allowed to obtain approval for IMTO.

“The permissible activities of International Money Transfer Operators shall include inbound international money transfer transactions only.

“The transactions shall be limited to the following activities: Cross-border personal money transfer services, such as money transfer services towards family maintenance; money transfer services in favour of foreigners visiting Nigeria, etc.

“The money transfer services shall target individual customers, and the transaction is on a ‘person to person’, ‘business to person’, and ‘business to business’ basis, which the CBN may review from time to time”, the circular partly reads.

CBN’s sweeping policy intervention comes to curb the continued fluctuations in the country’s FX market.

Recall that the CBN also issued a guideline to curb foreign currency hoarding and speculation on Wednesday.

The development impacted the Naira positively as it rebounded against the US dollar on Wednesday.