Competitive diaspora remittance market will engender Naira stability — ABCON
The Association of Bureau De Change Operators of Nigeria (ABCON) on Monday said that a competitive Diaspora Remittance market space would engender Naira stability.
President, ABCON, Alhaji Aminu Gwadabe made the assertion in an interview with journalists in Lagos, against the backdrop of the recent CBN Naira for dollar policy issued on March 5.
Gwadabe lauded the apex bank’s policy, but said more needed to be done for the policy to achieve its intended objective of shoring up the value of the Naira through liquidity boost.
He said there was the need to break the monopoly of some certain players in the remittances space by allowing the participation of other stakeholders like BDCs in the realm of remittances.
According to him, Kenya, Ghana, South Africa, etc, have all deepened their remittance space through a heavy competitive market space.
The ABCON boss said that measures taken by the aforementioned countries had enabled them to achieve volumes, leading to the stability of their local currencies.
He said that the Naira for dollar measure was among the many recent strategies deployed by the CBN to attract more Diaspora remittances into the official channel and address the foreign exchange liquidity concerns in the market.
“There is no doubt the incentive will be somehow attractive to the targeted beneficiaries of the remittances and therefore aimed to address concerns of one of the principal ally in the chain of remittances,” Gwadabe said.
He said that statistics from the Nigerians in Diaspora Commission (NiDCOM) suggested that over 17 million Nigerians legally residing in the Diaspora remitted over 20 billion dollars in 2020 in spite of the COVID-19 pandemic.
“This therefore suggests that it is a window, if well articulated and includes all the principal allies in the remittances space, will help the Nigerian economy for the availability of FX liquidity,” Gwadabe said.
The CBN, in a circular dated March 5, 2021, directed all Deposit Money Banks and International Money Transfer Operators to henceforth pay recipients of diaspora remittances N5 for every USD received as remittance inflow.
The incentive, tagged “Naira 4 Dollar Scheme,” was announced in a circular signed by Saleh Jibrin, CBN ‘s Director, Trade and Exchange Department.
Jibrin said that the scheme, which would run from March 8 until May 8, would allow all recipients of diaspora remittances to be paid N5 for every one dollar received.
He said that beneficiaries would get the incentive, whether they collect the remitted dollars as cash across the counter or through their domiciliary accounts.
The director said all commercial banks and International Money Transfer Operators (IMTOs) should ensure that the scheme takes effect from March 8.
