The Central Bank of Nigeria (CBN) has announced the removal of cash deposit limitations on domiciliary accounts, days after the deregulation of the Nigerian forex market.
The move comes barely a week after the apex announced new guidelines guiding the nation’s new forex regime.
A statement issued by the CBN following an extraordinary Bankers’ Committee meeting held on Friday, June 16, where a discussion about implementation and implications of floating the naira was held, said domiciliary account holders can withdraw up to $10,000 per day.
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“Domiciliary account holders are permitted to utilize cash deposits not exceeding USD$ 10,000 per day or its equivalent via telegraphic transfer. DMBs shall provide returns to the CBN, including the “purpose” for such transactions,” the circular said.
“Cash deposits into domiciliary accounts will not be restricted, subject to DMBs conducting proper KYC, due diligence and adhering to the spirit and letter of extant AML/CFT laws and other relevant rules and regulations.”
The central bank said it will give priority to the timely and orderly settlement of any committed Foreign Exchange (FX) forward transactions to enhance market confidence.
The apex bank added that it will work towards standardizing its Cash Reserve Ratio (CRR) maintenance processes and ensure fair implementation across the banking industry.
See the full statement below:
CBN Issues Further Guidance on Operational Changes to Foreign Exchange Market
Following the Central Bank of Nigeria (CBN) press statement of June 14, 2023, on new guidelines in the foreign exchange market, an extraordinary Bankers’ Committee meeting was held on Friday, June 16, 2023, to discuss its implementation and implications for the banking public.
These policy changes aim to promote transparency, liquidity and price discovery in the FX market in order to improve FX supply, discourage speculation, enhance customer confidence and ensure overall stability in the FX market.
According to the Director, Corporate Communications, Dr. Isa Abdulmumin, the CBN, in line with deliberations at the meeting, provided further guidance to Deposit Money Banks (DMBs) as follows:
All visible and invisible transactions (medicals, school fees, BTA/PTA, airline and other remittances) are eligible for the Investors’ and Exporters’ (I & E) window.
DMBs shall ensure expeditious processing of all eligible invisible transactions on behalf of their customers using the applicable rate at the I & E window.
Ordinary domiciliary account holders shall have unfettered and unrestricted access to funds in their accounts. Domiciliary account holders are permitted to utilize cash deposits not exceeding USD$ 10,000 per day or its equivalent via telegraphic transfer. DMBs shall provide returns to the CBN, including the “purpose” for such transactions.
Cash deposits into domiciliary accounts will not be restricted, subject to DMBs conducting proper KYC, due diligence and adhering to the spirit and letter of extant AML/CFT laws and other relevant rules and regulations.
The CBN will prioritize orderly settlement of any committed FX forward transactions as they fall due in order to boost market confidence further.
The Bank will normalize its CRR maintenance processes and ensure equity in its implementation across the banking industry.
The CBN will continue to engage stakeholders and issue further guidance as it implements the ongoing reforms.
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