The Central Bank of Nigeria (CBN) has announced the implementation of its digital currency, known as the eNaira, as a payment alternative for recipients of diaspora remittances.
This means that individuals receiving remittances from abroad now have the option to receive their funds in eNaira.
CBN 🇳🇬 Approves #eNaira for Diaspora Remittances
International Money Transfer Operators are required to open merchant wallets through the CBN and pre-fund the CBN account with foreign currency.
Alternatively, IMTOs can integrate with the eNaira portal using an available API pic.twitter.com/G5XCaBnvmc
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CBN stated that this initiative is part of its broader efforts to liberalize the payout process for diaspora remittances. By introducing the eNaira as a payment option, the CBN aims to provide more flexibility and accessibility to individuals receiving funds from abroad.
The details regarding the integration of the eNaira as a payment option for diaspora remittance recipients are outlined in a circular issued by the CBN. The circular, titled ‘Operational Framework for eNaira Payment Option to Recipients of Diaspora Remittances,’ was addressed to both the International Money Transfer Operators (IMTOs) and the general public, and was signed by Dr. Ozoemena Nnaji, the Director of the Trade and Exchange Department at the CBN.
According to Dr. Nnaji, the guidelines outlined in the circular are designed to streamline the process of disbursing funds from diaspora remittances to recipients who opt for the eNaira as their preferred payment method. International Money Transfer Operators (IMTOs) are instructed to apply for a one-time ‘No-Objection’ approval from the Central Bank of Nigeria to enable them to make payments in eNaira.
Additionally, the CBN expects banks to furnish account details where foreign currency received from the International Money Transfer Operators (IMTOs) will be deposited.
According to the operating framework provided by the central bank, the International Money Transfer Operators (IMTOs) are mandated to open merchant wallets directly through the CBN. In addition, the IMTOs are also required to pre-fund the CBN account with foreign currency.
Following the pre-funding of the CBN account by the IMTOs with foreign currency, the CBN will subsequently credit the IMTO merchant wallet with the equivalent value in eNaira.
In the payment procedure outlined by the CBN, the sender of a diaspora transfer will initiate the transaction with their preferred IMTO located overseas. During the process, the sender will provide the necessary details of the recipient’s wallet, such as the wallet address or identification information, to the IMTO.
Subsequently, the IMTO will access the eNaira web wallet portal and proceed to debit its own eNaira merchant wallet. Simultaneously, the IMTO will credit the recipient’s eNaira wallet with the equivalent amount in eNaira of the foreign currency sent from the origin country based on the prevailing I&E (Investors’ and Exporters’) window rate.
Alternatively, the CBN has stated that IMTOs have the option to integrate their platforms with the eNaira portal using an Application Programming Interface (API) provided by the CBN.
By doing so, the IMTOs can directly initiate the transfer of the eNaira equivalent of the foreign currency sent from the origin country based on the prevailing I&E window rate.
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