Wise (formerly TransferWise), the UK-headquartered fintech renowned for its low-cost international money transfers, has once again re-enabled payouts to Nigeria in the local currency, Naira.
This is coming after the fintech on several occasions suspended remittances to Nigeria. But with the Central Bank of Nigeria’s recent guidelines it has decided to re-enter the Nigerian market. Recall that in January 2024, the CBN issued a directive reversing its earlier stance on remittance inflows, which had required that funds be paid out exclusively in US dollars.
The new policy mandates that all remittances be paid in naira to recipients’ bank accounts or disbursed in cash for amounts below the $200 equivalent. This shift prompted Wise to terminate dollar remittances to Nigeria and comply with the new naira payout requirements. Wise now allows its UK customers to send Naira to Nigerian bank accounts, aligning with the CBN’s most recent guidelines for international money transfer operators (IMTOs).
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Wise’s re-entry into the Nigerian remittance market is not its first. The fintech has had a long history with the Nigerian market, with operations repeatedly starting and suspended over the past decade. In 2015, Wise first launched naira payouts as part of its global expansion, enabling customers to send US dollars and other currencies to several new markets, including Nigeria.
After just over a year, Wise halted naira transfers in May 2016, due to its inability to offer a true mid-market exchange rate and transparent fees. In October 2017, the Fintech resumed services in Nigeria after a 17-month break, only to suspend operations once more in 2020.
Speaking on its suspension of services in 2020, the company said it decided to pause remittances to Nigeria after new rules in the country changed the currency of payment to the U.S. dollar from naira.
The CBN noted that the change was to reduce arbitrage whereby money transfer operators profited from unofficial channels, listing Wise as an unlicensed money transfer operator. However, Wise stated that it could no longer offer money transfers in naira.
Fast-forward to 2022, the fintech once again ceased naira transfers, citing difficulties maintaining reliable payout providers and regulatory compliance.
In an email, Wise told its users that from November 1, 2022, a dollar transfer to Nigeria would be suspended. “From 1 November, we’re stopping all USD transfers to Nigeria.” Wise wrote in the statement.
The London-based payment company added, “We are doing this because sending money to Nigeria hasn’t been as fast or reliable as we did like. We want to fix this before your next USD transfer to Nigeria. The route will be closed until we’re sure we can provide the service you deserve. We’ll let you know as soon as USD transfers to Nigeria are available again.”
Now in 2024, Wise has returned to the market, adapting to the CBN’s new remittance policies. Despite these past challenges, Wise’s re-entry into the Nigerian market signals a renewed effort to comply with local regulations and offer financial services that meet the needs of its customers. With the CBN’s new guidelines in place, Wise is poised to provide a more stable and reliable remittance service to Nigerians, helping facilitate cross-border transfers in local currency.