Banks selling foreign exchange in violation of the law risk sanctions from CBN.
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The Central Bank of Nigeria (CBN) has threatened to punish banks engaging in illegal sales of forex. The acting Governor of CBN, Folashodun Shonubi, who disclosed this during a lecture titled: “Diaspora Remittances and Nigerian Economic Development”, in Abuja, emphasized the importance of strict steps to restrict illegal remittances and channel them via appropriate means to maximize economic growth.
Shonubi announced the formation of a commission to pay unscheduled visits to banks accused of unlawfully selling of dollars.
“We need to name and shame commercial banks involved in such malpractices,” he stated. The acting governor also emphasized the shortcomings of the present remittance system, in which he estimated that the cost of transferring money to Sub-Saharan Africa from the diaspora at about 8–9 per cent of every $100, which is described as the highest in the world. He, however, noted that Nigeria received about $16.7b in remittances, with the vast majority of the money outside the legal market.
“We are working hard to encourage individuals to bring money into the formal sector rather than relying on informal channels, which have become difficult to manage,” he stated.
Despite efforts to induce individuals to engage in formal market transactions by granting a N5 refund, he said that the technique has been ineffective, prompting the N5 rebate to be discontinued.
The CBN boss acknowledged the usefulness of incentives in attracting people to the formal market. He stated: “We will rename the foreign exchange market, known as the I & E market, to the Nigerian Foreign Exchange Market, as it is the sole market we acknowledge.”
The Commandant of the National Institute of Security Studies, Ayodele Adeleke, emphasized the relevance of the lecture series in extending the country’s awareness of security concerns. He stated that the series was one of the tactics embedded in the mode of the 10-month course to promote and provide a focal point for the program.
