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CBN Freezes Accounts Without BVN, NIN April 2024

The Central Bank of Nigeria (CBN) has directed a ‘Post No Debit’ (PND) restriction on all bank accounts without Bank Verification Number (BVN) and National Identification Number (NIN) effective April, next year.

‘PND’ is a term used to describe a restriction imposed by banks on specific accounts, preventing customers from making withdrawals, transfers, or any other debits from their accounts.

“The measure effectively freezes the funds in the account, rendering it inaccessible for the duration of the restriction.

In a circular on Friday by CBN’s Director of Payments System Management Department, Mr. Chibuzo Efobi; and Director of Financial Policy and Regulation Department, Mr. Haruna Mustapha, addressed to all deposit money banks, the apex bank also stated that all the BVN or NIN attached to and/or associated with all accounts/wallets must be electronically revalidated by 31st January 2024

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Banking

CBN restricts BDCs to one dealer bank per week for $25,000 FX purchase

Foreign education gulped $609.5m in eight months — CBN

The Central Bank of Nigeria (CBN) has introduced new regulations allowing Bureau de Change (BDC) operators to purchase up to $25,000 weekly from a single Authorised Dealer Bank (ADB) to cater to retail forex demand for eligible invisible transactions.

The directive, outlined in a circular from the Trade and Exchange Department and signed by Dr. W. J. Kanya, the Acting Director, is dated February 5, 2025. It sets compliance requirements aimed at promoting transparency and curbing potential forex misuse.

Key Provisions of the New Guidelines include: Single Dealer Bank Rule: Each BDC can only source FX from one authorised dealer bank per week, a measure designed to prevent speculation and enhance regulatory oversight.

It says violators will face sanctions.

According to the bank, authorised dealers must sell FX to BDCs at the prevailing rate in the Nigerian Foreign Exchange Market (NFEM) window, ensuring uniform pricing.

BDCs cannot charge more than Ipercent above their purchase price when selling FX, regardless of its source, to prevent excessive charges and promote fairness.

“Purchased FX can only be used for specific transac-tions, with a cap of $5,000 per transaction per quarter.

Eligible uses include:Busi-ness Travel Allowance (BTA)
/ Personal Travel Allowance (PTA); Overseas school fees ;Overseas medical expenses;
Strengthened Anti-Money Laundering Measures, ” the circular.

To combat financial crimes, the CBN mandates that BDCs to maintain proper records, including the Bank Verification Number (BVN) of end-users.

It also mandates them to endorse disbursed amounts in beneficiaries’ international passports;Strictly comply
with Anti-Money Laundering (AML) laws and Know Your Customer (KYC) requirements.

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To enhance transparency, both ADBs and BDCs must submit reports to the CBN.

They must send weekly reports of FX sales to BDCs in a specified Excel format via teddmo@cbn.gov.ng.

The CBN noted that BDCs must render daily returns on forex purchases and utilisa-tion through the Financial Institutions Forex Reporting System (FIFX).

The CBN warns that any BDC or Authorised Dealer Bank found violating these guidelines-including forex diversion-will face severe sanctions, including the suspension of their dealership license.

In a related development, the CBN has extended the deadline for BDC operators to access the Nigerian Foreign Exchange Market (NFEM) for weekly FX purchases. Initially set for January 31, 2025, the deadline has been pushed to May 30, 2025.

The extension is expected to stabilise the parallel market, improve liquidity, and reinforce the CBN’s commitment to ensuring forex accessibility while maintaining regulatory oversight.

These new measures align with the apex bank’s broader strategy to stabilise the naira, curb speculative activities, and enhance forex market transparency.

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Banking

Nigeria’s economy to expand by 4.17%, inflation to ease in 2025 — Cardoso

The Central Bank of Nigeria Governor, Olayemi Cardoso, on Thursday, said the country’s Gross Domestic Product is expected to grow by 4.17 percent and inflation is expected to ease in 2025.

Cardoso disclosed this at a recent conference, according to Reuters.

While Nigeria’s inflation currently stands at 34.80 percent, Cardoso is optimistic that it is expected to decline as President Bola Tinubu’s reforms start to yield results.

He also said foreign exchange reserves rose gradually, driven by increased oil production. Oil output is forecast to reach 2.3 million barrels per day by mid-year, Cardoso said.

Cardoso pledged to take Nigeria’s foreign exchange reserves to more than $40 billion after recording a $6 billion FX inflow in 2024.

According to Cardoso, the central bank’s priority remained to maintain price stability and to bolster market confidence. To this end, the bank aims to enhance transparency and efficiency within the foreign exchange market.

“With limited opportunities for FX arbitrage, we expect that there will be more appetite for real sector development,” he stated.

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Banking

CBN fines 9 banks N150m each over scarcity of cash in ATMs

The Central Bank of Nigeria, CBN, has issued fines to at least nine Deposit Money Banks for failing to ensure cash availability via automated teller machines, ATMs, during the festive season.
The fines total N1.35bn, with each of the banks fined N150m.

The banks were found culpable after spot checks revealed non-compliance with the Central Bank’s cash distribution guidelines.

A statement released by CBN acting Director of Corporate Communications, Mrs Hakama Sidi Ali, on Tuesday, read: “In a clear message of zero tolerance for cash flow disruptions, the Central Bank of Nigeria has sanctioned Deposit Money Banks for failing to make naira notes available through automated teller machines during the yuletide season.

“Each bank was fined N150m for non-compliance, in line with the CBN’s cash distribution guidelines, following spot checks on their branches. The enforcement action follows repeated warnings from the CBN to financial institutions to guarantee seamless cash availability, particularly during periods of high demand.

“The affected banks include Fidelity Bank Plc, First Bank Plc, Keystone Bank Plc, Union Bank Plc, Globus Bank Plc, Providus Bank Plc, Zenith Bank Plc, United Bank for Africa Plc, and Sterling Bank Plc.”

The fine will be debited directly from the banks’ accounts with CBN.

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