Foreign Direct Remittances To CBN Hit $5.8bn In 9 Months

By Nse Anthony-Uko
(Sundiata Finance) – Total direct remittances under the watch of Central Bank of Nigeria (CBN) in nine months of 2017 rises to estimated N1.8 trillion or $5.8 billion, current data has shown.
At $1/N305, the data from CBN’s website revealed N169.5 billion or $555 million was remitted in January this year but dropped to N63.89 billion or $209.48 million in February. In March, it moved to N227.9 billion or $747.35 million and N132.8 billion or $435 million in April and N226.7 billion or $743 million in May respectively.
According to CBN, total direct remittances hit N280.7 billion or $920.3 million in June and increased to N318.9 billion or $1 billion in July this year. The data from the apex bank showed that total direct remittances dropped by 24 per cent to N242.8 billion or $796 million in August and closed September at N116 billion or $381 million.
The remittance from CBN has been coming from International Money Transfer Operators. (IMTO) and global oil prices earnings. The price of Organization of Exporting Countries (OPEC) basket of 14 crude countries gained 14 per cent to $60.73 per barrel as at December 6, 2017 from $53.3 it started trading early this year.
The apex bank on its official website had disclosed that Total direct remittances between 2010 and 2016 rose to estimated N12.1 trillion or $39.5 billion. As at December 2016, total direct remittances to CBN was at N2.13 trillion, an increase of 17 per cent from N1.8 billion in 2015.
The CBN said, about $3.7 billion was the highest peak amount remitted in 2016, precisely December 31, 2016. The lowest amount remitted was $85.4 billion, while for 2015, total remittance hit the peak of $1.13 billion. The CBN, in 2016, had licensed 11 additional international money transfer operators.
Total remittance to CBN in 2014, however, was N2.49 trillion, the highest amount remitted to the apex bank in the six years under consideration, while in 2013, it was at N694 billion, the lowest amount remitted to CBN.
A total of N1.4 trillion and N1.72 trillion was total amount remitted to CBN in 2012 and 2011 respectively. In addition, N1.78 trillion was the total amount remitted to CBN in 2010. The total direct remittance recorded the highest inflow in 2010 and 2011 with 29 and 25 days of remittance.
The CBN had mandated financial service providers to be duly licensed in order to protect customers and the financial system, adding that international money transfer operators are required to remit foreign currency to their agent banks in Nigeria for disbursement in Naira to beneficiaries.
The CBN said that interested applicants should forward their request for licensing under the CBN 2014 Guidelines on International Money Transfer Services in Nigeria. World Bank in a report disclosed that remittances to developing countries fell for a second consecutive year in 2016, a trend not seen in three decades.
According to the World Bank report, an improved global economic outlook, remittances to developing countries are expected to recover this year, growing by an estimated 3.3 per cent to $444 billion in 2017.
The report by World Bank said, “The global average cost of sending $200 remained flat at 7.45 per cent in the first quarter of 2017, although this was significantly higher than the Sustainable Development Goal (SDG) target of three per cent. Sub-Saharan Africa, with an average cost of 9.8 per cent, remains the highest-cost region.
“A major barrier to reducing remittance costs is de-risking by international banks, when they close the bank accounts of money transfer operators, in order to cope with the high regulatory burden aimed at reducing money laundering and financial crime.
“Remittance flows to Sub-Saharan Africa declined by an estimated 6.1 per cent to $33 billion in 2016, due to slow economic growth in remittance-sending countries; decline in commodity prices, especially oil, which impacted remittance receiving countries; and diversion of remittances to informal channels due to controlled exchange rate regimes in countries such as Nigeria. Remittances to the region are projected to increase by 3.3 per cent to $34 billion in 2017,” the report added.

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