FOREX Market: CBN Orders Banks on Customers Free Access to Domiciliary Accounts

THE Central Bank of Nigeria, CBN has ordered banks to allow customers to have free access to funds in their domiciliary account.

According to the CBN, domiciliary account holders are permitted to utilise cash deposits not exceeding $10,000 per day or its equivalent via telegraphic transfer.

Director, Corporate Communications, Department, CBN, Dr. Isa Abdulmumin, disclosed this in a press statement titled: “CBN Issues Further Guidance on Operational Changes to Foreign Exchange Market.”

These policy changes aim to promote transparency, liquidity and price discovery in the FX market, in order to improve FX supply, discourage speculation, enhance customer confidence and ensure overall stability in the FX market. Deliberations at the meeting, provided further guidance to Deposit Money Banks (DMBs) as follows:

“All visible and invisible transactions (medicals, school fees, BTA/PTA, airline and other remittances) are eligible for the Investors’ and Exporters’ (I & E) window.

“DMBs shall ensure expeditious processing of all eligible invisible transactions on behalf of their customers using the applicable rate at the I & E window.

“Ordinary domiciliary account holders shall have unrestricted access to funds in their accounts. Domiciliary account holders are permitted to utilise cash deposits not exceeding USD$ 10,000 per day or its equivalent via telegraphic transfer. DMBs shall provide returns to the CBN, including the “purpose” for such transactions.

“Cash deposits into domiciliary accounts will not be restricted, subject to DMBs conducting proper KYC, due diligence and adhering to the spirit and letter of extant AML/CFT laws and other relevant rules and regulations.

“The CBN will prioritise orderly settlement of any committed FX forward transactions as they fall due in order to boost market confidence further.

“The Bank will normalise its CRR maintenance processes and ensure equity in its implementation across the banking industry”.

The statement also said CBN will continue to engage stakeholders and issue further guidance, as it implements the ongoing reforms.