…Tightens grip on diaspora remittances with new rules
By Charles Ebi
Governor of the Central Bank of Nigeria, Olayemi Cardoso, has raised concerns over growing cross-border financial risks as foreign investors accounted for 27% of the N4.61tn raised by Nigerian banks under the ongoing recapitalisation programme.
Speaking at the 4th Annual IMF/AFRITAC West 2 High-Level Executive Forum for Financial Sector Regulation and Supervision held in Abuja, Cardoso said the increasing participation of foreign capital in Nigeria’s banking sector underscores the need for stronger regulatory coordination across Africa.
According to him, while the inflow of foreign funds reflects investor confidence in Nigeria’s financial system, it also heightens exposure to external shocks and spill over risks that could destabilise domestic markets if not properly managed.
“As our banks expand across borders and attract significant foreign investment, the risks we face are no longer confined within national boundaries”, Cardoso said. “This makes collaboration among African regulators not just desirable, but essential”.
He noted that Nigeria’s banking sector has remained resilient despite macroeconomic challenges, including subsidy removal and foreign exchange reforms, adding that the recapitalisation drive launched in 2024 was designed to strengthen buffers and position banks for future growth.
The CBN governor disclosed that the programme has so far attracted N4.61tn in fresh capital, with nearly 27% coming from foreign investors, while Nigerian banks continue to expand their footprint across African markets.
Cardoso stressed that the pace of financial integration across the continent is outstripping regulatory coordination, warning that fragmented oversight could amplify systemic risks during periods of global uncertainty.
To address this, he called for the adoption of shared prudential standards tailored to Africa’s unique economic realities, which would enable regulators to respond more effectively to emerging threats while supporting financial stability and inclusive growth.
On domestic reforms, Cardoso reaffirmed the apex bank’s commitment to strengthening corporate governance and enforcing stricter regulatory discipline.
He said the CBN has ended years of regulatory forbearance and introduced measures to restrict access to banking services for chronic loan defaulters.
“Our stance is clear, zero tolerance for regulatory breaches. We are reinforcing accountability, improving supervision, and ensuring that the banking system remains sound and resilient”, he said.
He added that the restriction placed on non-performing large obligors is aimed at promoting credit discipline, protecting depositors, and safeguarding the integrity of the financial system.
Cardoso also reiterated the bank’s commitment to orthodox monetary policy, noting that efforts are ongoing to restore price stability, strengthen policy credibility, and anchor market expectations.
On the role of technology, he said the CBN is taking a balanced approach to regulating financial technology firms, ensuring that innovation does not come at the expense of financial stability.
He referenced the bank’s Fintech Policy Report as part of broader efforts to build supervisory capacity in a rapidly evolving digital financial landscape.
In his remarks, the Director of IMF AFRITAC West 2, Ivohasina Fizara Razafimahefa, said the forum provides a platform for regulators to exchange ideas and develop coordinated responses to emerging risks, including those posed by fintech, artificial intelligence, and climate-related financial challenges.
The forum, which drew participation from central bank officials across six African countries, focused on strengthening regional cooperation and enhancing the resilience of financial systems in the face of evolving global risks.
Cardoso emphasised that sustained collaboration among African regulators will be critical in building a stable, integrated financial system capable of supporting long-term economic growth across the continent.
Meanwhile, the apex Bank has introduced a new regulatory framework to strengthen oversight of diaspora remittances and enhance transparency in Nigeria’s foreign exchange market.
Under the new directive, all International Money Transfer Operators ,IMTOs, are required to open and maintain naira settlement accounts with authorised dealer banks, through which all remittance-related transactions must be processed.
The policy, contained in a circular dated March 24, 2026, was signed by the Director of the Trade and Exchange Department, Dr. Musa Nakorji, and made public on the apex bank’s website on Tuesday.
According to the CBN, the move is designed to “enhance diaspora remittances, strengthen transparency, traceability, and effective monitoring of all transactions”.
With the new arrangement, all inflows, beneficiary payments, and settlement activities linked to international transfers will now pass strictly through designated accounts held with authorised dealer banks in Nigeria.
The framework also limits how such accounts can be funded, stating that they “shall only be credited with remittance flows and proceeds of foreign exchange conversions by licensed IMTOs (or their agents)” within the Nigerian Foreign Exchange Market.
As part of the changes, IMTOs must formally designate their settlement accounts and submit details to the apex bank, while providing updates when necessary.
The CBN said the policy will also improve efficiency in the FX market, allowing authorised dealer banks to transfer foreign currency from IMTO accounts to other banks and approved participants, including Bureau De Change operators.
In addition, IMTOs are now required to align their pricing with real-time market rates from the Bloomberg BMatch system. The circular stated that operators “shall observe real-time market prices from the Bloomberg BMATCH and utilise this as guidance for pricing transactions with their customers and Authorised Dealers”.
The apex bank noted that the pricing guideline would “improve price discovery, reduce information asymmetry between IMTOs and banks, and encourage increased participation in the official FX market”.
It also stressed that all operators must maintain accurate transaction records and comply fully with anti-money laundering, counter-terrorism financing, and counter-proliferation financing regulations.
“This directive takes effect from May 1, 2026. Please note and ensure compliance”, the circular stated.
Analysts say the move signals a broader push by the CBN to channel remittance inflows through formal banking systems, deepen liquidity in the official FX market, and enhance regulatory oversight of cross-border financial flows into Nigeria.
