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Noorudeen Fasasi: Diaspora remittances in Nigeria and the hassle: A critical observation of the situation

In December 2020, the Central Bank of Nigeria issued series of circulars in furtherance of its new policy on diaspora remittances.

Also on 22nd January 2021, the CBN issued another circular setting out the modalities for the payout of diaspora remittances.

There are potential effect of the new circular in respect of the CBN policy on diaspora remittances.

The Circular on Modalities for Payout of Diaspora Remittances

According to the CBN, some IMTOs and unlicensed companies continue to facilitate diaspora remittances into the country in Naira, in clear contravention of the CBN directive that all remittances be paid to beneficiaries in dollars.

The CBN stated categorically in the new circular that:

  • Only licensed International Monetary Transfer Operators IMTOs are permitted to carry on the business of facilitating diaspora remittances into Nigeria;
  • All diaspora remittances must be received by beneficiaries in foreign currency (by cash and/or transfers to domiciliary accounts or recipients);
  • IMTOs are not permitted, under any circumstances, to disburse diaspora remittances in Naira (either in cash or by electronic transfers), be it through remittance settlement accounts (which had been earlier directed to be closed), third party accounts or via any other payment platforms within and/or around the Nigerian financial system.

Despite all these guidelines that were given by the CBN on money remittances it’s doesn’t reflect the hassles or effects on the citizen as it has been a major problem for almost all beneficiary.

Noorudeen Fasasi The Only measure of receiving fund are Money Transfer which is specifically in Dollar,Cash PickUp and direct transfer to Domiciliary Account.

The Process of Transfer by WorldRemit, MoneyGram, Western Union,RiaMoney and other are always in dollars which recepient expected to provide their Identity Card,BVN and the Code or Secret Questions to have access to the money meanwhile this process of doing the transaction are within a stipulated time which depends on the number of customers, accuracy of network and other factors within the banking hall.

If any recepient is coming for this transaction he or she must be ready to use within 30 minutes and 1 hour 30 minutes depending on the network and other factors.

Three out of Five recepient complain about the timing and process of remittances but they don’t have option except to abide with the guides and regulations of receiving their money.

On the Direct transfer to a Domiciliary Account, it’s like the process of getting to the bank and picking up a withdrawal slip to drawn money from the account though this process also make use of network and if there is fluctuation or inadequacy of network might affect the timing as well.Moreso if you want to do this type of transaction it will be between the range of 10 minutes to 20 minutes which as a factor of network and numbers of people on the queue.

The process are basically favourable to some and unfavourable to some recepient and from observation it seems there are some people that are receiving Naira directly to their local bank account but probably maybe some country can pay directly while some can’t pay directly to bank account in Nigeria.

The CBN with their directive targeted how to regulate and focus on diaspora remittances while neglecting the hindrance of the recepient in getting money from diaspora.

We hope the process will bring a new development in the modalities of remittances which will be of great benefit to the recepient and the government.

👨‍💼Author: Noorudeen Fasasi 

The views and opinions expressed in this publication are those of the author, and do not purport to reflect the opinions or views of Quillcastle Nigeria.

About the author

Quillcastle Nigeria

Quillcastle Nigeria is an independent premium news publisher covering tech startup news, analysis, art, lifestyle, career, and other top industry updates (especially) from Africa’s largest economy (Nigeria), and beyond.

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