The Chairman of the Association of Licensed Mobile Payments Operators (ALMPO), Jay Alabraba is appealing to the Central Bank of Nigeria (CBN) to change its policy directive on payment of diaspora remittances.
The members want the central bank to reverse the policy that requires banks to make payments in dollars allowing them to pay in naira, claiming that it limits the number of Nigerians that can access the funds. This is according to a report by the News Agency of Nigeria (NAN) which cited comments from the Chairman of ALMPO, Mr. Jay Alabraba.
“The CBN’s decision to restrict international remittances to USD payouts only is the overarching concern of everyone. It certainly limits the number of Nigerian citizens that can conveniently access funds sent from the diaspora. I sincerely hope that CBN reconsiders its position on this, and re-allow Naira payments in cash or into accounts or wallets,” Jay Alabraba.
Mr. Alabraba also disclosed that the CBN’s instruction was a “serious worry” for their business and suggested that the apex bank’s decision may have been a temporary measure.
Alabraba also said that the apex bank’s decision, which had caused serious worry for Mobile Money Operators, had challenged the Industry association to further engage with CBN on the issues.
Backstory
On December 16th, the Central Bank of Nigeria (CBN) issued additional guidelines for diaspora remittances in the country citing infractions of its previous circular. It blamed mobile payment operators for flouting its directives for operators to pay remittances in dollars accusing them of paying in naira.
According to the apex bank, despite spelling out procedures “regrettably, a few operators continue to pay remittances in local currency contrary to the regulatory directive” and then issued instructions amongst which includes the following;
- All MMOs are required to immediately disable wallets from receipt of funds from IMTOs.
- Payment service providers are directed to cease integrating their systems with IMTOs going forward and must prevent the comingling of remittances with other legitimate transactions.
On November 30th the CBN stated that beneficiaries of Diaspora Remittances through International Money Transfer Operators (IMTOs) shall henceforth receive such inflows in foreign currency (US Dollars) through the designated bank of their choice.
Why are they appealing
The plea by money transfer operators suggests the decision by the CBN may have severely dented a major source of revenue for its members.
- Apart from cutting them instructing them from not paying in naira, the decision shuts out any potential margin they may have made from forex exchanges.
- Thus restricting their revenue to only commissions on transfers. They have also been told to disable wallets and directed to cease integrating their systems with IMTOs.
Update: This article was updated to reflect new information.
Mad people everywhere. Don’t they see that the CBN regulations has drastically brought the black market price for USD to a very good low. Let them go and look for other things to do. Must we have cartels everywhere to shortchange our people?
Cbn made the right law to protect the country. We cant be favouring a few of over the collective good of the nation
CBN, please never go back. They have been exposed for the bastardization of the local currency and agents of capital flight.
If you listen to them, that will be the greatest undoing to the economy. Enough is enough of the game.
Why begging cbn to reverse it policy?, over the years, this financial syndicate have been raking in huge financial benefits (foreign currencies) at the expense of individuals who are remmiting these monies. Whatever that is wrongly eaten, must be forcefully regurgitated!!!!
This appears to be a good policy by the CBN
What took place prior to this policy is best called unethical practice
The Money transfer companies collected Forex (dollars, pounds etc) as remittances and bought Naira from the Nigerian deposit banks paid out Naira to beneficiaries in Nigeria. Now what did the Nigerian deposit banks do with the forex? They reinvested it abroad (in New York stock exchange, London FTSE, British and US Treasury bills, US and British Corporate and infrastructure bonds and the real estate market) such that the forex never ever hit Nigeria. After this policy the Money transfer organisations will be forced to fly in cash dollars to pay out remittances thereby hopefully flooding the Nigerian economy and it’s dollars (remittances to Nigeria stand at about 24 billion dollars a year. The only problem here is that after people collect the remittances in dollars they are themselves forced to resort to the Mallams whose machinations know no bounds.
The CBN governor should not listen to them. These are the cartels or whatever they are destroying the economy of Nigeria
These bloodsucking cabals have been benefitting from the lifeline of the naira. Some Nigerians are really agents of financial destruction. How can I send dollars home and you blatantly declined to pay my beneficiaries the money as sent. The CBN should stick to its guns. Enough of these bloodsucking economic vampires.