'It’ll boost the naira' - Nigerians abroad send home $282m as remittances in 3 months

Nigeria recorded $282.61 million as direct forex remittances in the first quarter of 2024.

The information was obtained from the Central Bank of Nigeria’s (CBN) website on Monday, May 13, 2024.

Diaspora remittances decline

Forex remittance is the money transferred from Nigerians abroad to family or other individuals.

The amount represents a decline of $18.96 million or a 6.28% drop compared to the $301.57 million recorded in the same period in 2023.

According to reports, during the first quarter of this year, remittances stood at $138.56 million in January, dropping later to $39.14 million in February before recording an uptick of $104.90 million in March.

Remittances to Nigeria are made via various avenues, including international money transfer operators (IMTOs) and banks.

CBN gives marching orders to IMTOs

On April 20, 2024, the apex bank partnered with IMTOs to commit to doubling remittance flows via formal channels into the country.

On February 13, 2024, the bank announced that customers will now be paid in naira for dollar transactions made via the operators.

CBN mandated the IMTOs to quote exchange rates for naira payout to recipients based on the prevailing official FX rates.

ThisDay reports that the bank also suspended IMTOs from facilitating money transfers from Nigeria to other countries.

Nigeria to receive more inflows in 2024

The development comes amid a forecast by the Standard Bank that the Nigerian economy will experience an FX inflow of $5.1 billion in the second quarter of this year.

The bank said the Nigerian economy expects inflows from various sources, including Eurobond sales, a $2.25 billion World Bank loan, and an NNPC-Afreximbank crude oil swap deal.

Analysts have said the remittance will boost the naira’s performance against the dollar.

According to them, the naira’s current fall is due to a liquidity squeeze in the FX market.

Maurice Ibeh, a financial analyst, said Nigeria needs FX remittances and interventions from the CBN. He said the naira's excellent performance in April was due to a boost in the dollar supply the previous month.

“The remittances are good but could be better to shore up the naira’s performance. Apart from the remittances, Nigeria needs to expedite action on crude oil production to earn money forex now that oil is selling above $80 per barrel,” he said.