The introduction of the eNaira, the Central Bank of Nigeria’s digital currency, as a method of payment for beneficiaries of remittances from the diaspora has been announced by the CBN.
The move, according to the apex bank, was made to advance attempts to liberalise the distribution of diaspora remittances.
The bank’s circular from June 15, 2023, headed Operational Framework for eNaira Payment Option to Recipients of Diaspora Remittances, stated the new policy.
This would make it easier to pay the proceeds of diaspora remittances to recipients who select eNaira as a payment option, according to the circular signed by Dr. Ozoemena Nnaji, director of the CBN’s Trade and Exchange Department, and addressed to the public and International Money Transfer Operators (IMTOs).
According to the regulations, the IMTOs must request a one-time “No-Objection” from the Central Bank of Nigeria (CBN) in order to pay out in eNaira.
The banks were asked to give account information for receiving foreign currency from IMTOs.
The CBN emphasised that receiving remittance earnings in eNaira remained an option, and that the choice to pay out in digital currency would occur concurrently with the option to pay out in dollars.
The framework stipulates that IMTOs must pre-fund the CBN account with foreign currency and open merchant wallets through the CBN.
As a result, the central bank will prefund the IMTO merchant wallet with the eNaira equivalent of the foreign currency.
The CBN added that in order to initiate a diaspora transfer with an overseas IMTO of choice and provide information on the beneficiary’s wallet, the sender must do so.
In order to credit the beneficiary with the eNaira equivalent of the foreign currency sent at the origin at the I&E window rate, the IMTOs must first log into the eNaira web wallet interface, debit its eNaira merchant wallet, and debit its eNaira merchant wallet.