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CBN to provide N10m guarantees to BDCs for outbound money transfers


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Nigeria

IMAGE: Godwin Emefiele, governor, Central Bank of Nigeria »

August.18.2014

The Central Bank of Nigeria (CBN) has announced plans to provide up to N10 million in guarantees for each recapitalised bureau de change (BDC) interested and qualified to participate in the outbound money transfer operations launched at the weekend.

Godwin Emefiele, governor, Central Bank of Nigeria (CBN), said, however, that the money will be taken out of the BDCs’ N35 million mandatory cautionary deposit held by the apex bank in line with the new recapitalisation guidelines.

According to him, the proposed guarantees are to provide some confidence to the BDCs to carry out the transactions, as the CBN will soon announce conditions under which those ‘money changers’ will qualify to participate in the scheme.

“We will ensure that the guarantees are not culled and that is why we are going to put in place very stringent, qualifying criteria before you become an agent to take on these transactions,” the governor stated.

The outbound money transfer service, the first of its kind in Nigeria, was launched in Abuja by the CBN in partnership with Western Union Money Transfer (WUMT), and the First Bank of Nigeria, which becomes the first Western Union agent to offer this service.
The initial launch is currently limited to select FirstBank branches until the service is rolled out to Western Union’s over 5,000 agent locations nationwide.

Emefiele said the outbound money transfer will provide Nigerians the opportunity of transferring funds up to US$2,000 to their relatives and dependents abroad (person to person transfer). With this new arrangement, Nigerians will only pay the naira equivalent to the money transfer service operators for foreign currency disbursements to recipients abroad.

Currently, inbound money transfer services which are dominated by three companies, the Western Union, Royale Finance as well as Moneygram, are being made in foreign currencies.

Article Credit: Businessdayonline

Updated 4 Years ago
 

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