Remittances into Nigeria declined 6.28 percent from $301.57 million in Q1 2023 to $282.6 million in Q1 2024, according to data from the Central Bank of Nigeria.
Direct foreign exchange remittances in Nigeria denote the transfer of money from a Nigerian sender outside of the country to family members or other individuals within the country. These remittances are channelled through different avenues, such as International Money Transfer Operators and banks, facilitating their inflow into Nigeria.
There was a significant rise in direct remittances in January 2024, with the $138.56 million received representing a 75 percent surge from January 2023’s $79.19 million. However, remittances dipped to $39.15 million in February 2024, marking a significant 53.26 percent decrease from the $83.76 million recorded in the same month last year [2023].
Interestingly, in February 2024, several crypto companies in Nigeria, including Binance, discontinued the purchase of USDT and USDC stablecoins using the Naira. Binance and other exchanges are facing increased regulatory scrutiny as authorities believe that crypto platforms facilitate speculation and potential manipulation of exchange rates.
REGULATION | Crypto Exchanges to Stop StableCoin Sales in Nigeria Amid Apparent Crackdown
“There was a meeting of crypto founders on Tuesday [February 27 2024] morning, and a number of them agreed to suspend the trades on their platform,” a person at that meeting told a local… pic.twitter.com/iiYBuYrpOu
— BitKE (@BitcoinKE) February 29, 2024
The downward trend continued in March 2024 with remittances totalling $104.91 million, a 24.3 per cent decline from March 2023’s $138.63 million.
As reported by BitKE, the Central Bank of Nigeria recently formed a task-force to double remittance inflows into the country from the $20.5 billion received in 2023. The task-force is to be formed with consultation of the International Money Transfer Operators (IMTOs) as part of efforts to increase formal remittance inflows into Nigeria and boost forex supplies.
🇳🇬REGULATION | Nigerian Central Bank Forms Task-Force to Double Remittances, Lower Transaction Costs, and Standardize Compliance
According to the latest World Bank data, Nigeria accounted for 38% of the $54 billion remittance inflows into sub-Saharan Africa in 2023.
The… pic.twitter.com/BueuQhZEJ3
— BitKE (@BitcoinKE) April 25, 2024
According to the latest World Bank data, Nigeria accounted for 38% of the $54 billion remittance inflows into sub-Saharan Africa in 2023. The inflows to Nigeria increased by 2% that year [2023].
According to the bank, fixed exchange rates and capital controls are diverting remittances to the region from official to unofficial channels. Moreover, sending $200 to the region cost 7.9% on average in the second quarter of 2023 compared to a global average of 6.2%.
REPORT | Sub-Saharan Africa Remains the Most Expensive Region for Sending #Remittances, Says Latest World Bank Research
On a regional outlook, Sub-Saharan Africa remains the most expensive region to send money to, recorded at 7.39 percent total average cost in Q3 2023.… pic.twitter.com/xA8qJSsyRV
— BitKE (@BitcoinKE) May 13, 2024
Meanwhile, according to Bloomberg, the local currency slipped to 1,466.31 to the dollar, its weakest level since March 20 2024, hurt by the local scarcity of the U.S. currency which on May 9 2024 halved from the day before to just $84 million.
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