The Central Bank of Nigeria (CBN) is taking strategic measures to support Nigerian businesses in enhancing their competitiveness through capacity building, investment in technology, and encouraging collaboration among financial institutions, business leaders, regulators, and policymakers to identify and dismantle barriers to growth and increase Nigerian products exports.
The apex bank is advocating standard upgrade for Nigerian products to meet international requirements and inspire confidence in locally produced goods. These measures are expected to boost export proceeds and support moves to attract more forex to the domestic economy.
Higher forex inflows to the domestic economy come with great benefits and support the CBN’s drive for price and exchange rate stability.
The CBN, under its Governor, Olayemi Cardoso, puts enough efforts into ensuring that more forex flows into the economy and that such inflows remain accessible to businesses.
Among several measures, one quick win to attract more foreign exchange to the economy is by raising the global competitiveness of Nigeria’s products meant for export.
Other moves include boosting diaspora remittances through new product development, granting licenses to new International Money Transfer Operators (IMTOs), implementing a willing buyer-willing seller FX model, and enabling timely access to naira liquidity for IMTOs. The apex bank has simplified dollar-inflow channels for FX dealers to boost business and economic growth.
Diaspora remittances to Nigeria, estimated at $23 billion annually, remain a reliable source of forex to the domestic economy. There are also other sources and policies that are being explored by the apex bank to keep dollar inflows coming. The CBN’s initiatives have supported continued growth in these inflows, aligning with the institution’s objective of doubling formal remittance receipts within a year.
The remittances in the economy are expected to increase based on CBN’s ongoing efforts to bolster public confidence in the foreign exchange market, strengthen a robust and inclusive banking system, and promote price stability, which is essential for sustained economic growth.
Director of Trading at Verto, Charlie Bird, said dollar liquidity dynamic is now more balanced, with foreign investors and airlines able to repatriate funds. Speaking during Cordros Asset Management seminar titled: “The Naira Playbook”, he said Nigeria is now the darling of foreign investors because of improved dollar liquidity in the economy due to positive CBN reforms.
For instance, the CBN under Cardoso recently announced the introduction of two new financial products designed to serve Nigerians living abroad and attract more diaspora remittances. These and other measures, including the granting of licenses to new International Money Transfer Operators (IMTOs), implementing a willing buyer-willing seller model, and enabling timely access to naira liquidity for International Money Transfer Operators (IMTOs).
Enhancing product quality for export
The CBN and Bankers’ Committee are championing initiatives to improve the quality of Nigerian products for export to global markets.
According to the CBN, Nigerian manufacturers can only stand a chance in the global market if their products can compete favourably with their counterparts abroad.
Although Nigerian products often lack the quality and packaging standards required to compete in global markets, the banking sector is expected to play a crucial role in supporting businesses in enhancing their competitiveness. Locally made goods and services need better branding to increase their visibility and appeal in global markets and businesses require support to prepare for global market competition.
Speaking during Bankers’ Committee meeting in Lagos, Director, Consumer Protection and Financial Department, CBN, Dr. Aisha Olatinwo said that with the ongoing support from the apex bank and commercial banks, local businesses will improve their potential to thrive in the global markets, which will trasl, however admitted that there are a number of constraints militating against the growth of Nigerian-made goods.
Olatinwo, represented by the Deputy Director, Consumer Protection and Financial Department, CBN, Nelson Amuwa, hinted that the bank is working to address these constraints in quality, packaging, branding, and global market readiness that hinder the growth of locally made goods and services. Echoing similar sentiments, the Executive Chairman of the Lagos State Internal Revenue Service (LIRS), Ayodele Subair, acknowledged that the financial sector has a role to play in ensuring the continuous survival of businesses.
He said: “The Bankers’ Committee plays a vital role in facilitating financial inclusion and driving Made-in-Nigeria products. By working together, stakeholders can unlock the full potential of Nigeria’s financial system and promote export diversification and support local businesses.”
While delivering his keynote address, Dr. Bamidele Ayemibo said manufacturers need to adopt the product quality, packaging and product branding. These measures, he emphasised, would ensure the competitiveness of Nigerian products in both regional and global markets.
Raising some posers, Ayemibo said, “From manufacturing to fashion, to technology, and to the industry, our ability to compete depends on how well we can align to embrace productivity and deliver consistent, high-quality products that command respect in global markets.
“By deepening these partnerships, we can identify and dismantle barriers to growth, encourage innovation, and scale up the support structures that enable enterprises to thrive in competitive environments. The Nigerian banking sector remains a critical industrial foundation to build Nigerian products, opportunity-building initiatives, and investment technology. Banks are well-positioned to support businesses in enhancing their competitive opportunities,” he stressed.
Nigerian manufacturers, he said, “should ensure that the products are attractive and suitable for specific markets. And utilise packaging as a branding tool. Packaging can serve as a critical component of branding. Nigeria should design packaging that not only protects the product but also tells the story and resonates with the consumer.”
Also speaking at the event, the President of the Manufacturers Association of Nigeria (MAN), Otunba Francis Meshioye, who described the town hall meeting as timely, lamented that the operating climate for the manufacturing subsector has been anything but friendly.
According to him, manufacturers spent a whopping N1.3 trillion on the cost of funds in 2024 alone even as he lamented that the soaring interest rate which oscillates between 35-37% was a disincentive to business.
He would rather the CBN and the Bankers Committee come up with long-term financing options for manufacturers at favourable terms that would drive and not strangulate business concerns.
“It is critical at this point for the CBN and the Bankers Committee to fund production at cheaper rates, and also fund backwards integration, amongst others. That’s only to cut down the excess amount expended on the cost of funds which is adversely affecting production in the country.”
Understanding revised IMTO guidelines
The CBN recently released the revised guidelines of International Money Transfer Services in Nigeria. These Guidelines mark a significant shift in how IMTOS conduct their operations, reflecting the CBN’s ongoing efforts to enhance transparency and efficiency in foreign exchange transactions and to bolster diaspora remittances into Nigeria.
Further circular titled “New Measures to Enhance Local Currency Liquidity for Settlement of Diaspora Remittances” highlighted the apex bank’s commitment to improving the Nigerian foreign exchange market infrastructure by increasing the flow of remittances through formal channels.
It introduces measures aimed at providing licensed IMTOs with access to Naira liquidity from the CBN, facilitating the disbursement of remittances to beneficiaries.
In a report analysing the circular, analysts at Duale, Ovia & Alex-Adedipe, a specialised law firm with leading experts in its core areas of practice, explained that the guidelines permit IMTOs to conduct payout foreign remittances through agents, who are designated as Authorised Dealer Banks (ADBs). They require IMTOs to enter into formal contracts with ADBs outlining the terms and conditions of their engagement. Additionally, IMTOs are required to notify the CBN of the appointment of each ADB.
Furthermore, IMTOs are to receive foreign remittances in a designated account maintained with ADBs.
They explained that the account must be separate from other accounts held by the IMTO. The guideline mandates ADBs and IMTOs to disburse proceeds of foreign remittances to beneficiaries in Naira. According to them, payments can be made either through a bank account with the ADB or in cash, provided the cash withdrawal does not exceed $200. If a beneficiary does not have an account with the IMTO’s ADB, the ADB will credit the beneficiary’s account with another bank. Notably, under the Guidelines, IMTOs are prohibited from purchasing foreign exchange from the domestic market to settle funds for their customers.
The major significance of the circular is the introduction of measures to enhance the access of IMTOS to Naira liquidity, thereby facilitating the timely settlement of diaspora remittances.
Here, eligible IMTOs can now directly access the CBN window or use their ADB to execute transactions involving the sale of foreign exchange in the Nigerian market.
All eyes on diaspora remittances
As part of its efforts to boost diaspora remittances and support naira stability, the CBN recently announced the introduction of two new financial products designed to serve Nigerians living abroad.
The Non-Resident Nigerian Ordinary Account and the Non-Resident Nigerian Investment Account were created to streamline remittances, encourage investments, and foster financial inclusion among Nigerians in the diaspora.
It said, “The Central Bank of Nigeria is pleased to inform the general public of the introduction of the Non-Resident Nigerian Ordinary Account and Non-Resident Nigerian Investment Account targeted at Nigerians in diaspora.”
The initiative is also expected to provide a secure and efficient platform for managing funds and investing in Nigeria’s financial markets.
President, Association of Bureaux De Change Operators of Nigeria, Dr. Aminu Gwadabe, explained that diaspora remittances are a crucial source of foreign exchange for Nigeria, supplementing both foreign direct investment and portfolio investments.
He said the CBN’s initiatives have supported continued growth in these inflows, aligning with the institution’s objective of doubling formal remittance receipts within a year. Gwadabe noted that remittances in the economy are expected to increase based on CBN’s ongoing efforts to bolster public confidence in the foreign exchange market, strengthen a robust and inclusive banking system, and promote price stability, which is essential for sustained economic growth.
In a report, “Diaspora remittances: The power behind Africa’s sustainable growth”, Regional Vice President of Africa at Western Union, Mohamed Touhami el Ouazzani, said remittances may be measured through the movement of money, but their real impact is measured in lives changed.
He disclosed that in 2023 alone, $90 billion flowed into Africa from its global diaspora, an amount that rivals the Gross Domestic Product of entire nations.
He said that remittances symbolise deep ties that keep communities connected across borders. “Families with a breadwinner working abroad depend on these funds to provide vital support for day-to-day needs. They also build the foundation for broader financial stability,” he said.
“Beyond their immediate impact, remittances are powerful drivers of economic change. They fuel infrastructure development, spur entrepreneurship, and promote financial inclusion – all essential for long-term economic development. Ghana’s National Financial Inclusion and Development Strategy (NFIDS) is simplifying access to remittances, while countries like Kenya, Ethiopia and Nigeria are tapping into diaspora bonds to fund infrastructure and other national projects,” he added.
For remittances to be truly transformational, it begins with understanding and meeting people’s aspirations. Ensuring individuals who strive for more can send and receive funds, regardless of their financial status, is crucial. We must cater to diverse needs.