CBN Unveils Tougher Forex Rules, Slams N100m Fine on Banks Over Documentation Breaches

The Central Bank of Nigeria (CBN) has rolled out a stricter regulatory framework for the foreign exchange market, introducing hefty penalties for banks and authorised dealers that fail to comply with documentation and reporting requirements.

Under the newly revised Foreign Exchange Manual released in May 2026, financial institutions that process foreign exchange transactions without adequate supporting documents risk paying a ₦100 million fine, alongside an additional ₦10 million penalty for each transaction involved.

The updated manual, which replaces the previous version introduced in 2017, is designed to strengthen oversight of foreign exchange activities, improve transparency, and enhance compliance across the financial system.

According to the apex bank, the revised guidelines are intended to ensure that foreign exchange resources are properly monitored and directed towards productive sectors of the economy while curbing market abuses and regulatory violations.

Tougher Compliance Measures
Beyond the new sanctions on undocumented transactions, the CBN has also tightened rules governing banks’ foreign exchange operations.

Financial institutions that exceed their approved Net Open Position (NOP) limits will now face escalating penalties.

While a first violation will attract a warning, a second breach will result in a 10-working-day suspension from participating in the foreign exchange market.

A third offence will lead to a 90-day suspension.

The regulator has also reinforced reporting obligations for authorised dealers.

Daily foreign exchange transaction reports must now be submitted by 10 a.m. on the following business day, while monthly returns are required within five working days after the end of each month.

Failure to meet these reporting deadlines will attract financial sanctions. Late submissions will incur a ₦500,000 penalty, while institutions that fail to submit returns altogether face a minimum fine of ₦5 million, in addition to ₦500,000 for every day the violation remains unresolved.

The CBN further warned against the unauthorised reallocation of foreign exchange funds, noting that offenders could face monetary sanctions, suspension of their authorised dealer licences for at least six months, or complete licence revocation in severe cases.

New Rules For Importers And Exporters
The revised framework introduces stricter requirements for import-related transactions.

Importers are now expected to submit Exchange Control Documents within 90 days after negotiating shipping documents with overseas correspondent banks. Failure to comply will trigger restrictions on access to foreign exchange services and Form M processing.

Sanctions will become progressively stricter for repeat offenders, beginning with a 90-day restriction for the first violation and extending to a permanent exclusion from the foreign exchange market after a fourth offence.

Banks that fail to report defaulting customers will also face penalties, including warning letters and fines of ₦10 million for each affected transaction.

Exporters have not been left out of the compliance drive.

Under the revised guidelines, proceeds from non-oil exports must be repatriated within 180 days of shipment, while oil and gas export earnings must be received within 90 days.

Exporters who fail to repatriate proceeds within the specified timelines will be required to pay a penalty equivalent to one per cent of the naira value of the outstanding funds.

Banks that fail to enforce compliance will be fined 0.5 per cent of the unrepatriated amount.

The manual also grants the CBN authority to sanction institutions for delays in export documentation approvals, non-remittance of export supervision levies, and failures relating to export proceeds reporting.

Operational Reforms To Ease Transactions
Alongside the stricter enforcement measures, the apex bank introduced several reforms aimed at improving efficiency within the foreign exchange market.

The allowable advance payment threshold for imports has been increased from 15 per cent to 30 per cent, while a permissible import shortfall or excess margin of plus or minus 10 per cent of the Cost and Freight value on Form M has been approved.

The CBN also abolished processing fees for Form NXP, the document used for export transactions.

In addition, the revised manual expands provisions covering service exports, technology-related remittances, transactions conducted through the Pan-African Payment and Settlement System (PAPSS), non-resident investment accounts, and overseas tuition payments.

Under the new arrangement, students studying abroad can access tuition fee remittances of up to $25,000 per semester for both undergraduate and postgraduate programmes.

The regulator also removed the mandatory requirement for Form A on transactions funded through ordinary domiciliary accounts.

However, banks remain responsible for verifying the legitimacy and purpose of such transfers before processing them.

CBN Governor Olayemi Cardoso said the updated framework reflects the bank’s commitment to modernising Nigeria’s foreign exchange administration and strengthening macroeconomic stability.

According to the apex bank, the reforms were developed following extensive consultations with financial institutions, exporters, businesses, regulators and development partners.

The CBN expressed confidence that therevised framework will boost investor confidence, improve market liquidity, enhance transparency and support a more efficient and rules-based foreign exchange system.