CBN Directs Banks to Close Naira Ledger Accounts for IMTO to Increase Dollar Cash Inflow and Regulate Exchange Rates in the Country.

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The Central Bank of Nigeria (CBN) has directed banks in the country to close all naira ledger accounts opened specifically for the purpose of receiving proceeds from international money transfer operator (IMTO) with immediate effect.

What you should know: On 30, November 2020, CBN stated that beneficiaries of Diaspora Remittances through International Money Transfer Operators (IMTOs) will onwards receive such inflows in foreign currency (US Dollars) through the designated bank of their choice.

CBN states that all authorized dealers and the general public need to understand that the beneficiaries shall have full access and utilization to such foreign currency proceeds, either in cash and/or in their domiciliary accounts as stated in the circular issued two days ago.

How will it affect the market: This new policy is aimed to increase the inflow of dollar. It is targeted at allowing anybody who wants to receive dollar in cash to do so. Family and friends can receive dollar in cash and sell to naira at the official exchange rate making dollar available.

Quick Facts: Naira Ledger Accounts for IMTO means a ledger account dominated in naira that contains a record of business transactions which is a separate record within the general ledger. This form of ledger account is created for the purpose of accounting for IMTO which falls under revenue type under general ledger. Other forms of ledger accounts includes other ones assigned to a specific asset, liability, equity item, revenue type, or expenses.

How does it affect the crypto market: International card transactions will be heavily affected. It will be very much difficult at this time to buy bitcoin or naira using any naira debit cards.