CBN tightens remittance oversight with new Naira settlement mandate for IMTOs

The Central Bank of Nigeria (CBN) has announced a new regulatory framework for International Money Transfer Operators (IMTOs), mandating the use of designated Naira settlement accounts for all diaspora inflows.

The directive, aimed at enhancing transparency and liquidity in the official foreign exchange market, is set to take full effect on May 1, 2026.

According to a circular signed by Musa Nakorji, Director of the Trade and Exchange Department, all remittance transactions and beneficiary payments must now be processed strictly through accounts maintained with authorized dealer banks within Nigeria.

The policy shift is designed to close existing loopholes that allow funds to bypass traceable channels, effectively redirecting foreign exchange into the formal banking sector to curb parallel market leakages.

Under the new guidelines, IMTOs are granted the flexibility to open new accounts or designate existing ones across multiple banks.

However, the CBN has introduced a strict pricing discipline requiring operators to reference real-time rates from Bloomberg BMatch. This move is intended to improve price discovery and reduce the information gap between financial institutions and transfer agents, thereby fostering a more efficient market.

The apex bank also confirmed that authorized dealer banks are now permitted to process foreign currency transfers from IMTO settlement accounts to other approved market participants, including licensed Bureau de Change (BDC) operators. This is expected to improve the distribution of liquidity throughout the financial system.

As the May 2026 deadline approaches, IMTOs are required to align their digital systems with these new compliance standards, including rigorous adherence to anti-money laundering and counter-terrorism financing regulations.

The CBN maintained that these administrative measures are essential to restoring investor confidence and ensuring an orderly foreign exchange market.