The Central Bank of Nigeria (CBN) has come up with new forex measures to stop free fall of the Naira at the parallel market.
In a statement on Monday by the acting Director of Communications,Isaac Okoroafor, the bank said it is” providing direct additional funding to banks to meet the needs of Nigerians for Personal and Business Travel, Medical needs, and School fees, effective immediately.
“For medical and school fees, such payments must be made by commercial banks directly to the institution specified by the customer.
“The CBN would ensure that this process is as smooth as possible and that as many customers as possible get the foreign exchange they genuinely demand.
“The CBN expects such retail transactions to be settled at a rate not exceeding 20 per cent above the interbank market rate,” he said.
This, according to the bank, would also ensure that transactions were settled at much more competitive exchange rates.
The CBN also directed all banks to open Foreign Exchange outlets to sell dollars and other hard currencies at major airports to ease the burden of travellers.This is to be done so as soon as logistics permit.
CBN also reduced the tenure of its Forward Sales from the current maximum cycle of 180 days, to not more than 60 days from the date of transaction.
“In order to maintain confidence in the FX market, the CBN will immediately begin implementing its articulated programme to clear all the unfilled orders in the interbank FX market.
“Given our plan to meet all unfilled orders, and provision of FX to the manufacturing sector would remain the CBN’s strong priority, we will no longer impose allocation rules on commercial banks.
“We will implement an effective intervention programme to support the inter-bank market to ensure adequate liquidity necessary to deliver an efficient FX market,” he said.
The FMDQ trading was advised to activate its Foreign Exchange Order-Book systems as soon as possible and also accelerate the on-boarding of FX clients on the FX Relationship Systems to ensure total transparency of the FX market,the apex bank said.
“The Bank therefore encourages market participants to assist in ensuring that these new measures engender the preservation of our external reserves, stability of our financial system, and growth of our economy to the benefit of all Nigerians,” the statement said.