IMTOs are hereby allowed to quote exchange rates for naira payout to beneficiaries based on the prevailing market rates at the Nigerian Foreign Exchange Market on a willing seller, willing buyer basis

In a move to further liberalize the Nigerian foreign exchange market, the Central Bank of Nigeria on Wednesday lifted exchange rate restrictions for International Money Transfer Operators (IMTOs).

The restriction was previously announced in a circular dated 13 September 2023, with reference TED/FEM/PUB/FPC/001/009, announcing a significant shift in the regulation of exchange rates by IMTOs.

The circular initially mandated IMTOs to quote rates within an allowable limit of -2.5 percent to +2.5 percent around the previous day's closing rate of the Nigerian foreign exchange market.

However, according to the latest circular, signed by the CBN's Director of Trade and Exchange, Hassan Mahmud, IMTOs are now granted the flexibility to quote exchange rates for naira payout to beneficiaries based on the prevailing market rates.

"In line with the CBN's commitment to liberalize the Nigerian Foreign Exchange Market, IMTOs are hereby allowed to quote exchange rates for naira payout to beneficiaries based on the prevailing market rates at the Nigerian Foreign Exchange Market on a willing seller, willing buyer basis," it said.

The CBN also removed the cap on the allowable limit of -2.5 per cent to +2.5 per cent around the previous day's closing rate of the Nigerian foreign exchange market.

The CBN noted that the new circular supersedes the previous directive and urged authorised dealers, international money transfer operators, and the general public to comply accordingly.

This update is expected to improve the efficiency and flexibility of foreign exchange transactions as part of efforts to stabilise the Nigerian local unit.