In a move that will have an impact on Nigerian diaspora inflows the Central Bank of Nigeria (CBN) recently passed regulations that prevent the majority of money transfer operators (MTOs) from providing services in the country.
A number of MTOs that include startups like WorldRemit were instructed by their local affiliates that all transfers to the West African country wouldn’t be processed anymore.
Though no reason for the decision has been offered it seems to have been motivated in part by a memorandum from the Central Bank released in 2015 which set stringent conditions for operating a mobile money service such as a net asset value of US$1 billion for all MTOs as well as having been operational for at least 10 years.
With the new regulations only three MTOs, Western Union, MoneyGram and Ria, have been allowed to offer to services.
WorldRemit, one of the more active MTOs in Nigeria and the rest of Africa has been very critical of the decision. Its own service handles 40,000 money transfers into Nigeria, contributing to the country’s $21 billion remittances market.
Such a huge pie has attracted a number of new MTAs so perhaps this might be Nigeria’s regulatory approach to weed out services that could be unable to meet the demands of honouring all inflows.
However, the same response could have also locked out some genuine operators and inadvertently created an exclusionary environment that doesn’t benefit the consumers in the long term.
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5 comments
I thought this was to do with Boko Haram. These idiots are concerntrating on ruining Nigeria instead of fixing what’s broken.
Dunb Economic advisers. I will still get my money to my mom without the 3 companies that bribed this fantastically corrupt government. I send money home to my people that are not getting salaries for months and the Buhari government wants to force me to use Western Union. No way
The whole Nig sucks just now. I have been assisting some people to make their busines in Nig. helping is almost impossible bcs of the customs and now this World Remit thing. It seems that governement lives in 1800 century and any progress is NOT allowed. Everything must make the hardest way .
I really dont know what CBN is thinking! Its so sad that decisions cant be made to benefit the common people on Nigerian street. I wont be surprised if the decision was influenced by some greedy influential companies / people for person interest or gain at the detriment of others. When will Nigerian government understand basic representation of common interest and make decision to better its citizenry. All they do is power play for personal gain. This is really sad. I use World Remit to send money to my family with very low charges and and the money is credited directly to the nominated bank account, very easy service with no drama. Western Union money transfer with ridiculously high charges that makes the money you are sending to your loved at the end of the transaction of no value, is one of the money transfer company endorsed by CBN. Western Union used to have 78% of the market share of money transfers to Nigeria, but with more operator and players and increasing competition, they lost their strong hold on the market. Presently, Western Union controls only 20% of the market. This recent regulation by CBN is to profit who? Nigerians or seemingly powerful money transfer operator. when will this corrupt practices stop? When will the Nigerian government really govern effectively to benefit all?
This is sad news. Why all this sadistic policy by Nigerian government? I will NOT use Western Union. To hell with them.
They must have bribed the government to take over again and drag us all to difficult times. Shameful Nigeria.