The Central Bank of Nigeria CBN has explained that the “CBN Naira 4 Dollar Scheme” is aimed at providing Nigerians in the Diaspora cheaper and more convenient ways of sending remittances to Nigeria.
The Apex bank had in a circular dated March 5, 2021, signed by A.S. Jibrin, on behalf of the Director, Trade and Exchange Department, stated that the new initiative would become effective on Monday and Saturday, May 8, 2021.
In line with the initiative, all recipients of diaspora remittances through CBN’s licensed International Money Transfer Operators (IMTOs) shall henceforth be paid N5 for every $1 received as remittance inflow.
The apex bank explained in the circular, “The CBN shall through commercial banks, pay to remittance recipients the incentive of N5 for every $1 remitted by sender and collected by the designated beneficiary.
“This incentive is to be paid to recipients whether they choose to collect the United States dollar as cash across the counter in a bank or transfer same into their domiciliary account. In effect, a typical recipient of diaspora remittances will at the point of collection, receive not only the USD sent from abroad, but also the additional N5 per USD received.”
Highligthing benefits of the policy which comes into effect on Monday, March 8, 2021, the governor of the apex bank, Godwin Emefiele said
the move was also aimed at increasing the transparency of remittance inflows and reducing rent-seeking activities.
Emefiele who was delivering a keynote address at a Fidelity Bank’s Inaugural Diaspora Webinar on the “Implications and Impact of the New FX Policy on Diaspora Investments” expressed optimism that the new policy measure will encourage banks and financial institutions to develop products and investments vehicles, geared towards attracting investments from Nigerians in the diaspora.
According to him, the new policy is expected to enlarge the scope and scale of foreign exchange inflows into the country with a view to stabilizing the exchange rate and supporting accretion to external reserves.
More importantly, he said it would provide an opportunity for Nigerians living abroad to make investments in their home country.
The governor went on to emphasize that the new measure would help to make the process of sending remittance through formal bank channels cheaper and more convenient for Nigerians in the diaspora.
