In a bid to stabilize Nigeria’s economy and address soaring commodity costs linked to foreign exchange rates, Finance Minister and Coordinating Minister of the Economy, Wale Edun, announced a new Federal Government programme allowing individuals to deposit U.S. dollar bills held outside the formal banking system without penalties or scrutiny. The programme, set to last nine months starting from October 31, aims to increase dollar reserves and strengthen the foreign exchange supply within the formal banking sector.
Edun made the announcement following the 144th National Economic Council (NEC) meeting chaired by Vice President Kashim Shettima at the State House in Abuja. “There will be no penalty; there will be no taxes, and there will be no questions,” Edun assured, emphasizing that individuals participating in the programme will only need to meet the standard Know-Your-Customer (KYC) requirements set by banks, ensuring that funds brought into the system are from lawful sources.
According to Edun, “One element of the cost increase is the foreign exchange rate, which is demand and supply. This programme allows people to bring in dollars outside the banking system, which are otherwise unsafe and insecure, and integrate them into the financial system to make them safe and accessible for legitimate economic activities.”
The initiative aims to offer law-abiding individuals an opportunity to formalize their cash holdings, providing additional dollar reserves that could help stabilize the exchange rate. Edun explained, “Bringing those dollars from where they are doing nothing into the financial system adds to our reserves and helps support the exchange rate, benefiting Nigeria’s economy.”
He noted that the Ministry of Finance would release specific guidelines for the programme, with additional guidance from the Central Bank of Nigeria.
Edun also provided updates on government-led economic relief initiatives, reporting that 25 million Nigerians have benefitted from various federal social protection programs. These initiatives include digital outreach, microenterprise loans, and sector-specific support for power, agriculture, manufacturing, health, and compressed natural gas industries.
With this new programme, the Federal Government is optimistic that increased dollar deposits will alleviate foreign exchange pressures, driving commodity prices lower and supporting a more stable economic environment.
