The Central Bank of Nigeria (CBN) has reported a $553 million remittance inflow for July 2024, reflecting a 130% increase from the same period in 2023, largely attributed to International Money Transfer Operators (IMTOs).
International Money Transfer Operators (IMTOs) are licensed by the Central Bank of Nigeria (CBN) to manage the transfer of funds from overseas to Nigeria. They facilitate smooth international transactions, allowing individuals and organizations abroad to send foreign currency to their relatives, friends, or business associates in Nigeria.
The CBN highlights that this marks the highest monthly inflow on record, emphasising the effectiveness of its efforts to boost liquidity in Nigeria’s foreign exchange market.
Policy Measures Driving Growth
“The substantial growth in remittance receipts,” CBN says, “is attributable to policy measures introduced by the CBN to enhance liquidity in Nigeria’s foreign exchange market. These measures include granting licenses to new International Money Transfer Operators (IMOs), implementing a willing buyer-willing seller model, and enabling timely access to naira liquidity for IMTOs.”
Impact on Nigeria’s Economy
CBN highlights that diaspora remittances continue to play a crucial role in Nigeria’s economy, supplementing foreign direct investment and portfolio investments. CBN says that the policies have not only boosted remittance inflows but also contributed to strengthening public confidence in the foreign exchange market. This is in line with the bank’s objective to double formal remittance receipts within a year, further stabilising the nation’s economic framework”.
Inflation and Economic Stability
In addition to remittance growth, recent data from the National Bureau of Statistics (NBS) highlighted a year-on-year slowdown in Nigeria’s headline inflation rate for July 2024, the first decline in 19 months. This is a clear indicator that the CBN’s monetary policy tightening measures are yielding positive results, the bank says.
Looking Ahead
The CBN believes these initiatives will support broader economic stability, particularly in the foreign exchange market. The bank says it will keep a close watch on market conditions and adjust its policies as needed to ensure continued growth in remittance inflows and overall economic resilience.
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