November 21, 2024
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Diaspora remittances into Nigeria fell by 27 per cent, year-on-year (y/y) to $12.9 billion as at September 2020 from $17.6 billion in the corresponding period of 2019. The 27 per cent decline is 3.9 percentage points higher than the 23.1 per cent decline projected by the World Bank for the Sub Sahara Africa region in 2020.

However, quarter-on-quarter, remittances into the country rose in the third quarter of 2020 (Q3’20) by 14.8 per cent, thus reversing the declining trend recorded in Q2’20. In its Q3’20 Economic Report, the Central Bank of Nigeria (CBN) stated: “Inflow of personal transfers in the form of workers’ remittances increased significantly by 14.8 per cent to $3.87 billion, relative to $3.37 billion in the second quarter of 2020.” This is in contrast to the 42 percent decline recorded in Q2’20, when remittances fell to $3.37 billion from $5.64 billion in Q1’2020.

In a bid to boost the inflow of remittances through official channels into the country, the CBN recently introduced a new Diaspora Remittances policy. Under the new policy, recipients of diaspora remittances will receive the proceeds through designated banks of their choice. Such recipients may have the option of receiving the funds in foreign currency cash (US Dollars) or into their domiciliary account. The new policy also stated: “IMTO’s must ensure that all funds in favour of beneficiaries/recipients in Nigeria be deposited into the Agent Banks‘correspondent account. “Agent Banks (Deposit Money Banks) in Nigeria will be responsible for the payment to beneficiaries/recipients either in foreign currency cash (USD) or into the beneficiaries/recipients’ domiciliary account in Nigeria. “The mode (if payment either in cash or transfer) is at the sole discretion of the beneficiaries/recipients”, the CBN said in a circular signed by Mr O. Nnaji, Director, Trade and Exchange Department.” Prior to the new policy unveiled on November 30th, recipients of diaspora remittances were paid in naira at exchange rate determined by the banks and the International Money Transfer Operator (IMTO).

 

15 thoughts on “Remittances:  Foreign Inflow   to  Nigeria Drops by 27% to $12.9bn

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