Stakeholders are requesting that Nigeria be removed from the grey list of the Financial Action Task Force to reduce high transaction costs associated with remittance flows.
This was disclosed during the 2024 World Bank/IMF Spring Meetings on Wednesday, in Washington D.C., USA convened at a roundtable organised by the Central Bank of Nigeria aimed at enhancing remittance flows into Nigeria, according to nairametrics.
In attendance were both local and international stakeholders, including Lemfi, Flutterwave, J.P. Morgan, Remitly, VertoFx, Interswitch, BudPay, Makeba, TapTap Send, Visa, Venture Garden Group, and Ventures Platform.
The main focus of these discussions was to address the challenges and opportunities for facilitating greater remittance flows using official channels, strongly advocating Nigeria’s removal from FATF’s blacklist to significantly reduce transaction costs.
Recall the CBN In February 2024 had implemented a policy placing a ban on dollar and other foreign currency payouts for international transactions.
This follows the introduction of a naira payout option for diaspora remittances earlier.
In addition, the Central Bank of Nigeria in January, amended its guidelines for international money transfer operators by restricting them to only inbound transfers and halting outbound transfers.
Stakeholders at the CBN Round Table have underlined that it is important to provide for a variety of payment options in remittances, calling on both naira and dollar settlement as well as improved convenience among remitters.
The high cost of sending money to Nigeria and other Sub-Saharan African countries is highlighted in a World Bank report published in 2023, which notes that the region remains the most expensive remittance market worldwide with fees reaching up to 36% for every US$200 sent.
The Inter-Governmental Action Group against Money Laundering report noted that “Nigeria has not explicitly criminalised the financing of foreign terrorist fighters.”
However, Nigeria has made some progress, particularly, in line with FATF requirements, the Central Bank of Nigeria has recently published draft guidelines to Bureau de Change operators in Nigeria, that aim at aligning their operations according to international standards on AML and CFT. This move is part of broader efforts to prevent potential international blacklisting and improve the overall integrity of Nigeria’s financial system.
