CBN

The Central Bank of Nigeria (CBN) has raised the Monetary Policy Rate (MPR) by 50 basis points, bringing it from 26.75% to 27.25%.

This decision was reached at the 297th Monetary Policy Committee (MPC) meeting held in Abuja. The move signifies continued tightening of monetary policies as inflationary pressures persist.

CBN Governor, Olayemi Cardoso, disclosed that 11 of the 12 committee members present unanimously supported the rate hike.

“The committee was unanimous in the need to further tighten monetary policy,” Cardoso stated during the briefing.

In addition to the interest rate hike, the MPC opted to retain the asymmetric corridor of +500 and -100 basis points around the MPR. The Cash Reserve Ratio (CRR) was also increased from 45% to 50%.

These measures reflect the CBN’s determination to combat inflation and stabilise Nigeria’s economy, with Cardoso emphasising the importance of remaining vigilant in the face of global economic challenges.

The Central Bank of Nigeria has directed all Payment Service Providers to route all transactions from PoS terminals at merchant and agent locations — physical or electronic — through an approved CBN Payment Terminal Service Aggregator.

It also issued a 30-day deadline requiring service providers to comply with enhanced routing guidelines for Point of Sale transactions. This move aims to strengthen the monitoring of electronic transactions across Nigeria and decentralise PoS transaction routing, addressing concerns about the centralisation of such transactions under a single entity.

The apex bank, in a circular signed by Oladimeji Yisa Taiwo on behalf of the CBN’s Payments System Management Department on Thursday, stated that all PoS transactions from merchant and agent locations must now be routed through any CBN-licensed PTSA.

The circular read, “To achieve the objective of tracking electronic transactions in Nigeria, the Central Bank of Nigeria, in August 2011, granted a Payment Terminal Service Aggregator licence to Nigeria Interbank Settlement System Plc. In furtherance of the above, the CBN hereby directs acquirers to route all transactions from PoS terminals at merchant and agent locations, whether on physical or electronic PoS terminals, through any CBN-licensed Payment Terminal Service Aggregator.”

“PTSAs are required to send PoS transactions to only processors certified by the relevant Payment Scheme, nominated by the Acquirer, and licensed by the CBN.”

This development follows the expiration of the 5th September deadline for PoS agents to formally register their businesses with the Corporate Affairs Commission.

Although the directive was challenged in court, the CAC recently announced that it has commenced taking drastic actions, including shutting down PoS businesses that failed to register.

The directive on PoS business registration comes against the backdrop of frequent fraud incidents involving PoS terminals and the Central Bank of Nigeria’s plans to prevent trading in cryptocurrency or virtual currency.

According to a report by Nigeria Inter-Bank Settlement System Plc, PoS terminals accounted for 26.37% of fraud incidents in 2023.

The Central Bank of Nigeria (CBN) has reported a 130% surge in remittance inflows, with the figure reaching $553 million in July 2024.

According to the CBN, this milestone represents the highest monthly remittance inflows ever recorded, marking a significant increase from the same period in 2023.

This is according to a statement by Hakama Sidi Ali, the Acting Director of Corporate Communications, on Tuesday, August 20, 2024.

The CBN credits this surge in remittance inflows to a series of strategic policy measures designed to enhance liquidity in Nigeria’s foreign exchange market.

The statement read: “The Central Bank of Nigeria (CBN) has reported a significant increase in remittance inflows, reaching $553 million in July 2024, a 130 per cent increase from the corresponding period in 2023.

“This figure represents the highest monthly total inflows on record and reflects ongoing efforts by the CBN to enhance liquidity in Nigeria’s foreign exchange market.

“The substantial growth in remittance receipts is attributable to policy measures introduced by the CBN to enhance liquidity in Nigeria’s foreign exchange market. These measures include 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.

“Diaspora remittances are a crucial source of foreign exchange for Nigeria, supplementing both foreign direct investment and portfolio investments. 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 CBN also noted that the National Bureau of Statistics (NBS) reported a slowdown in Nigeria’s year-on-year headline inflation rate for the first time in 19 months, signalling the effectiveness of the CBN’s monetary policy tightening measures.

The CBN further expressed its commitment to closely monitoring market conditions and adjusting its policies as needed to ensure the continued flow of remittances, thereby contributing to the stability of the foreign exchange market.

The Central Bank of Nigeria (CBN) has denied plans to revoke the operating licenses of four major banks in the country – Fidelity, Polaris, Wema, and Unity Banks.

In a statement released on Monday, June 10, the CBN’s acting director of Corporate Communications, Hakama Sidi Ali, reassured the public of the safety of their deposits and the resilience of the banking system.

According to her, key financial soundness indicators remain within current regulatory thresholds.

Mrs. Sidi Ali addressed the misinterpretation of a January 10, 2024 circular announcing the dissolution of the Boards of Union, Keystone, and Polaris Banks, which is being misrepresented as a new directive. She clarified that this is an old notification and not a recent development.

The CBN spokesperson also dispelled rumours of further license revocations before the completion of the bank recapitalization exercise, labelling them unfounded and aimed at causing unnecessary panic.

“Without prejudice to the ongoing recapitalisation process, I want to restate that the Nigerian banking industry remains resilient,” Mrs. Sidi Ali said.

She urged customers, especially those of Heritage Bank, not to worry about the safety of their deposits, as the Nigeria Deposit Insurance Corporation (NDIC) has already begun payments to the bank’s insured depositors.

Mrs. Sidi Ali further encouraged the public to continue their regular banking activities without worry.

The Central Bank of Nigeria has directed banks to stop charges on cash deposits until September 30, 2024.

The apex bank disclosed this in a circular dated May 6, 2024, signed by its Director of Banking Supervision, Adetona Adedeji.

Customers of some of the Deposit Money Banks raised concerns that the banks have begun collection of processing fees for cash deposits as of May 1.

Our correspondent sighted this in an email shared by one of the customers of the banks.

Based on the bank’s move, two per cent was to be charged on deposits above N500,000 for individuals, while corporate account holders were to be charged two per cent on deposits above N3m.

According to the latest circular to financial institutions and non-financial institutions, CBN said the processing fees have been suspended.

The circular read, “Please refer to our letter dated December 11, 2023, referenced BSD/DIR/PUB/LAB/016/023 on the above subject, suspending processing charges imposed on cash deposits above N500,000 for Individuals and N3,000,000 for Corporates as contained in the ‘Guide to Charges by Banks, Other Financial Institutions and Non-Bank Financial Institutions’ issued on December 20, 2019,” CBN said.