These developments have left stakeholders with no option than to call on the CBN to outsource the weekly dollar sales from the Diaspora funds to independent agencies that can obey its directives. 50,000 Diaspora-related forex on weekly basis to nearly 3,000 BDC operators. The figure, it said, is by far the largest volume of remittances to any country in Africa and the sixth largest in the world. The funds are still being warehoused by prestamo facil interbank forex at a time supplies have dried up in several critical sectors.
21 billion annually to BDCs as instructed by the apex bank. Already Nigerian banks have been accused by the CBN of engaging in round-tripping, taking advantage of the huge forex gaps between the official and parallel markets to make a fortune. 50,000 weekly from Diaspora remittances to BDCs. The banks refused to obey the order despite several pleas by the apex bank that they disburse the funds to the BDC operators to boost liquidity in the forex market.
Alhaji Aminu Gwadabe, said only 10 per cent of BDCs in the Lagos market have so far accessed dollar from banks since the CBN gave the directive nearly a month ago. The proceeds of the international money transfer funds are not CBN money and not from its foreign reserves. This is money that Nigerians in Diaspora, are sending into the economy. Before now such money came through unofficial means, some sending through hands, and at the end of the day, the beneficiary will not even get it. The ABCON boss is urging the CBN to outsource the dollar distribution role to independent distributor since the banks have failed in their assigned role. Others are Diamond Bank, Zenith Bank and Stanbic IBTC Bank.
Gwadabe disclosed that BDCs in Port Harcourt, Kano, Abuja, Onitsha, Maiduguri, Benin and Enugu are yet to get a single dollar from these banks. The ABCON chief said that the banks are also selling dollar far above the interbank rate. The banks, he added, are supposed to sell to the BDCs on the same day within the week, but have failed to do so. Our members across the country have funded their accounts but the banks are not selling to them. I think the banks are compromising the policy and CBN’s directive on the matter.
50,000 weekly foreign currency accruing from inward money remittances to licensed BDCs. The directive was meant to ensure stability of the exchange rate and encourage participation of critical stakeholders in the foreign exchange market. Free Funds’ by Authorised Dealers, also accused the banks of buying and selling forex without following stipulated guidelines. He reiterated that as provided in the laws and regulations governing dealings in forex, authorised dealers shall not sell forex without appropriate documentation and disclosure to the regulatory authorities irrespective of the source of the funds.
The CBN has also accused commercial banks of compromise in the ways they handle proceeds from international money transfer inflows into the country. A circular to banks titled: Illicit International Money Remittances through the Banking System, and signed by Gotring, accused the lenders of opening multiple illegal companies and personal accounts where they harvest dollar proceeds for onward disbursements to recipients in Nigeria. Nigeria of September 26, 2014, warning the lenders to desist from such unwholesome practices. Gwadabe has praised the CBN’s decision, describing it as a right step in the right direction and inline with ABCON’s campaign that new operators be allowed into the market. L, Small World Financial Services Group Limited and Weblink International Limited. T Corporation Limited, Fiem Group LLC DBA Ping Express and CP Express Limited. CBN Acting Director, Corporate Communications, Isaac Okorafor, said the new entrants was in line with the ape bank’s efforts to liberalise the forex market, ensure liquidity and make forex more readily available to low end users.
Although the nine commercial banks barred by the CBN from the interbank forex market have been readmitted, an analysts at Lagos-based CSL Stockbrokers Limited predicted they may suffer about N50 million fine each. The CBN may want to demonstrate to the banks that it took their offences very seriously and make it painful to them. The regulator may want to make the fines painful to them, as a deterrent to others. Obire said although the banks are already facing hard times, but letting them go without a fine, could provide a wrong precedence for the industry. For Gwadabe, Nigeria BDCs can be strengthened to meet the forex demand at the retail end of the market so that they can continue to enhance employment generation in the country.
The ABCON boss believes that despite the challenges facing the economy, the CBN and BDCs can work together and find sustainable solutions that can help the country wriggle out of the ongoing forex crisis and achieve full economic recovery. Besides, ABCON has reached the final stage of automation of BDCs’ operations in Nigeria, and is seeking for CBN’s certificate of no-objection on the project. Gwadabe said the automation plan has been received by the CBN adding that a comprehensive reforms of the BDCs has already been unveiled earlier in the year. ABCON under Gwadabe has also pledged to ensure that purchased funds would be disbursed to end users and for eligible transactions only and shall render weekly returns on purchases from the banks to Trade and Exchange Department of the CBN. He further promised to ensure strict compliance to the provisions of the anti-money laundering laws observance of appropriate KYC principles in the handling of forex transactions. Your email address will not be published.
Notify me of follow-up comments by email. Notify me of new posts by email. Governor Ayodele Fayose of Ekiti State has called for the enthronement of peace and justice in the country, as Muslim faithful mark the end of the Ramadan period and celebrate the Eid-el-Fitri Festival. In his Sallah message in Ado-Ekiti yesterday through his Chief Press Secretary, Mr. Linus Oota , Lafia Governor Umaru Tanko Al-Makura of Nasarawa State and Speaker of the state’s House of Assembly, Hon. Balarabe Abdullahi, have congratulated Muslim faithful across the globe on the successful completion of the month- long Ramadan fast. The World Cup gets underway this week, with all eyes on Russia as the country readies to stage the greatest show on earth.