CBN moves to end round tripping in banks, monitors OTC forex sales

The Central Bank of Nigeria (CBN) has commenced the monitoring of deposit money banks to ensure their compliance to the regulations of foreign exchange (fx) market.Its move is to ensure an end to round tripping where banks divert foreign exchange obtained from the CBN at official rate to the black market for higher profits.

The practice had created artificial scarcity and had denied users of foreign exchange even in their most basic transactions.Governor of CBN, Godwin Emefiele, led a team of management staff to monitor Over-the-Counter (OTC) sales of forex by banks to users irrespective of whether they are account holders or not.

The CBN had last week directed banks to begin OTC sale of forex to all customers once they possess the necessary documents.Emefiele, who visited the zonal headquarters of some banks in Abuja yesterday, urged members of the public to go to the banks for all their foreign exchange needs.He explained that one did not need to be a customer to obtain forex from the banks and that such transactions should be concluded on the spot, once the applicants have their basic travelling documents such as international passport, valid visa and flight ticket.

His words: “We have issued a directive that all banks are mandated to sell basic transport allowance (BTA) to anybody that walks into their banks.  It is deliberate. Whether he is a customer of the bank or not, he should get forex.  It is the bank’s primary responsibility to provide currency for travelers out of the country.

“So, all you need are your passport, visa and return ticket. And you are not expected to just deposit your documents and go away. They should attend to you over the counter. “The essence of this visit is to see whether the banks are doing what they were asked to do. I must say that I am happy. The policy hasn’t gained ground. I would have loved to see a long queue of people waiting to buy BTA at the banks.”

He said the banks have enough foreign currencies and that people should not have problem getting foreign exchange, stressing that customers should access forex at designated PTA/BTA stands or Bureau de Change (BDCs).  “Customers are advised to pay N360 to a dollar. That is the essence of this visit.  It is symbolic that I see for myself and we will also be talking to the management of the banks,” he added.