The Central Bank of Nigeria (CBN), has announced the introduction of an Electronic Foreign Exchange Matching System (EFEMS), for Foreign Exchange (FX) transactions in the Nigerian Foreign Exchange Market (NFEM).

According to a statement issued by Omolara Duke, the Director, Financial Markets Department, the EFEMS will be implemented by Dec.1.

Duke said that the new system was expected to enhance governance, and transparency, and facilitate a market-driven exchange rate that would be accessible to the public.

"This development is expected to reduce speculative activities, eliminate market distortions, and give the CBN improved oversight capabilities to effectively regulate the market.

"Authorised dealers will subsequently conduct all foreign exchange transactions in the interbank Fx market on the EFEMS approved by the CBN where transactions will be reflected immediately," she said.

She said that there would be a two-week test run in November, adding that the apex bank would publish real-time prices when the EFEMS starts becoming operational.

She said that the CBN would also buy and sell orders from the system and in collaboration with the Financial Markets Dealers Association (FMDA), publish the rules for the EFEMS.

"The Nigerian FX Code and revised Market Operating Guidelines for the Nigeria Foreign Exchange Market will also provide guidance to market participants.

"Authorised dealers are, therefore, required to comply with extant guidelines and regulations governing the Nigeria foreign exchange market.

"They should ensure that all necessary documentation, training, and systems integrations are concluded ahead of the go-live date," she said.