By Onome Amuge
The Central Bank of Nigeria (CBN) threatened to withdraw foreign exchange dealership licences of banks that partner with International Money Transfer Operators (IMTOs), in violation of its directive that beneficiaries of diaspora remittances should be paid in their preferred currency.
The warning, issued in a circular signed by Ozoemena Nnaji, the director of the trade and exchange department, stated:
“The attention of the CBN has been drawn to the increasing illegal activities by Money Transfer Operators in Nigeria, through banks, by terminating payments in naira contrary to extant regulations.
This unwholesome practice has some banks partnering with unlicensed international money transfer operators who disguise their transactions and terminate the same via local inter-bank transfers.
Henceforth, any bank found to be aiding and abetting any IMTO or unlicensed operator in this activity would be appropriately sanctioned.”
Spurred by the urgency to boost diaspora remittances, especially through the banking system, the CBN, in a November 2020 circular to banks, had directed that beneficiaries of such remittances should be paid in dollars through the designated banks of their choice.
However, the apex bank, in the circular to banks,noted that some IMTOs engage in illegal activities through banks in violation of the directive, by paying diaspora remittances in naira.
The statement also reiterated that it is the responsibility of all banks to not only Know their Customers (KYC requirements) but also Know their customers’ business (KYCB. requirements).
For the avoidance of doubt, all banks and IMTOs were directed to pay out proceeds of diaspora remittance only in US dollars and comply with the guidelines on international money transfer operations as published by the CBN.
The statement therefore warned that any bank found to be aiding or collaborating with IMTOs in terminating remittances in naira will have their authorised dealership licence withdrawn
