The Central Bank of Nigeria (CBN) has announced a substantial 39 percent increase in remittance inflows through International Money Transfer Operators (IMTOs) for the first quarter of 2024 compared to the same period last year.
According to the recent CBN’s quarterly statistical bulletin, total inflows reached $1.07 billion in Q1 2024, up from $770.23 million in Q1 2023. This surge marks a notable boost in the foreign exchange supply to the country.
Breaking down the figures, January 2024 saw remittance inflows of $383.04 million, reflecting a 30 percent increase from $295.21 million in January 2023. February’s inflows reached $322.83 million, a dramatic 65 percent rise from $195.23 million in February of the previous year. March followed with $363.70 million, a 30 percent increase over the $279.79 million recorded in March 2023.
When compared to the last quarter of 2023, which saw inflows of $965.82 million, the first quarter of 2024 demonstrates an 11 percent rise, further underscoring the upward trend in remittances.
Recent reforms by the CBN appear to have significantly contributed to this increase. In January 2024, the CBN removed the cap on exchange rates previously imposed on IMTOs, which allowed for greater flexibility in currency conversion rates. Additionally, new guidelines issued by the CBN included an increase in the application fee for IMTO licenses from N500, 000 to N10 million, reflecting a substantial 1,900 percent increase over the past decade. The minimum operating capital requirement for IMTOs was also raised to $1 million for foreign entities and an equivalent amount for local IMTOs.
Furthermore, a recent policy shift has lifted the previous ban on IMTOs purchasing foreign exchange from the domestic market, allowing them to trade on the official market. This move aligns with the CBN’s strategic goal to double remittance inflows into Nigeria, facilitated by a Collaborative Task Force reporting directly to the Governor of the CBN, Mr. Olayemi Cardoso.
The CBN’s efforts to enhance the remittance inflow environment have also included granting 14 new Approval-in-Principle (AIP) licenses to IMTOs and streamlining operational processes. According to Mrs. Hakama Sidi Ali, Acting Director of Corporate Communications at the CBN, these reforms are part of a broader strategy to boost foreign currency supply and support Nigeria’s economic stability.
The significant rise in remittance inflows is a critical development for Nigeria, providing vital foreign exchange resources and bolstering household incomes across the country.