The Central Bank of Nigeria (CBN) has Issued a Directive to Banks, Instructing them to allow Customers unhindered access to Funds in their Domiciliary Accounts.
According to the CBN, Individuals holding Domiciliary Accounts are now permitted to utilize Cash Deposits up to $10,000 per day or its equivalent through Telegraphic Transfer.
In a Press statement titled “CBN Issues Further Guidance on Operational Changes to Foreign Exchange Market,” Dr. Isa Abdulmumin, the Director of Corporate Communications at the CBN, disclosed this new Development.
The Statement highlighted that the purpose of these policy Changes is to enhance transparency, liquidity, and Price discovery in the Foreign Exchange (FX) Market.
The ultimate Goal is to Improve the Supply of Foreign Exchange, discourage speculation, boost Customer Confidence, and ensure overall stability in the FX Market.
Following an Extraordinary Bankers’ Committee meeting held on Friday, June 16, 2023, to Discuss the Implementation and Implications of the new Guidelines, the CBN Provided additional Guidance to Deposit Money Banks (DMBs).
The Guidelines Include the following key points:
All visible and Invisible Transactions, such as Medical expenses, School fees, Business travel allowance/personal travel allowance (BTA/PTA), Airline remittances, and other remittances, are eligible for the Investors’ and Exporters’ (I&E) Window.
DMBs are required to promptly process all eligible Invisible Transactions on behalf of their Customers, utilizing the applicable Rate at the I&E Window.
Ordinary Domiciliary Account holders have unrestricted Access to Funds in their Accounts.
They are allowed to utilize Cash Deposits not exceeding $10,000 per day or its equivalent through Telegraphic Transfer.
DMBs are required to Provide returns to the CBN, Including the purpose of such Transactions.
Cash Deposits into domiciliary Accounts will not be Restricted, Provided that DMBs conduct proper Know Your Customer (KYC) Procedures, and due Diligence, and Comply with the Existing Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) Laws and other Relevant Regulations.
The CBN will Prioritize the orderly settlement of any committed Foreign Exchange forward Transactions as they fall due, aiming to further Boost Market Confidence.
The Bank will normalize its Cash Reserve Ratio (CRR) Maintenance Processes and ensure equitable Implementation across the Banking Industry.
The CBN reaffirmed its Commitment to Engaging Stakeholders and Issuing further Guidance as it continues to Implement ongoing Reforms.
These measures are aimed at Promoting a Well-Functioning and stable Foreign Exchange Market while providing Individuals with Easier Access to their Domiciliary Account Funds, facilitating legitimate transactions, and fostering Economic Growth.
