Despite the policies put in place by the Central Bank of Nigeria (CBN) to scale up the inflow of foreign exchange, statistics from the CBN revealed that the total direct foreign exchange remittances declined by 16.68 per cent Year-on-Year (YoY) to $1.55 billion in the nine months that ended September 2024, representing a drop by $31 million.
According to the bank’s “International Payments” data, which was released on Friday, the total foreign exchange direct remittances in the first nine months of 2023 was at $1.86 billion.
The CBN had reported a sum of $1.98 billion in total direct remittances in 2023, about an 8.2 per cent decline from the $2.16 billion recorded in 2022.
A quarter-on-quarter breakdown revealed that the total remittances stood at $282.62million in Q1 2024 as against $301.57million in Q1 2023.
Measures put in place to boost FX inflow included granting licenses to new International Money Transfer Operators (IMTOs), implementing a willing buyer-willing seller model, and enabling timely access to naira liquidity for IMTOs.
In Q2 2024, it stood at $829.3million, an increase of 27.5per cent from the $650.4million in Q2 2023, while in Q3 2024, the CBN reported $433 million total remittances, about 52per cent decline from $903.03million reported in Q3 2023.
The CBN allows direct remittances through its policies to encourage the inflow of foreign exchange into the country.
These remittances are usually made by Nigerians living abroad who send money to their families and friends in Nigeria.
While there have been concerns over the decline in total remittances to the country, despite the surge in the number of Nigerians relocating abroad, the vice president of Highcap Securities Limited, Mr. David Adnori said there may not be any cause for alarm.
According to him, the decline in remittances in the nine months of 2024 could be attributed to several factors including the weakening of the local currency, and policy directions of the CBN.
The apex bank had said overseas remittances into the country rose to $1.3 billion in February 2024 compared to $300 million in the preceding month.
However, its data put the total direct remittances in February 2024 at $39.15million.
The Acting Director of Corporate Communications, CBN, Mrs. Hakama Sidi Ali in a statement, reported a significant rise in foreign inflows in February 2024, driven by higher remittance payments from Nigerians living abroad and a spike in the purchase of naira assets by foreign portfolio investors.
Direct remittances come into the country via the International Money Transfer Operators, and banks, among others.
The CBN under the current Governor, Mr. Olayemi Cardoso had stated that its initiatives had supported continued growth in these inflows, aligning with the institution’s objective of doubling formal remittance receipts within a year.
The statement by Ali added, “The increase in remittances is a strong testament to the success of the 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.”