- Godwin Emefiele, CBN governor, blames the naira’s fall on the number of Nigerians studying abroad.
- He predicted a huge UK visa increase for Nigerians in 2023.
- Emefiele said the move has greatly strained Nigeria’s foreign reserves and the naira.
Godwin Emefiele, the governor of the Central Bank of Nigeria (CBN), attributes the depletion of foreign reserves to the number of Nigerian students seeking education abroad.
According to Emefiele, the official foreign exchange received from crude oil sales into Nigeria’s reserves has steadily decreased from over $3 billion per month in 2014 to zero dollars in 2022.
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Nigerian students seeking visas oversees increase
This was something that he discussed during the 57th annual bankers’ dinner that was held in Lagos on November 26, 2022 and was hosted by the Chattered Institute of Bankers of Nigeria (CIBN).
The head of the Central Bank of Nigeria (CBN) stated that the Nigerian foreign exchange market is currently in the midst of a severe crisis, which is placing strain on the reserves and lowering the value of the naira.
According to a report by BusinessDay, market demands for various goods and services have continued to rise despite falling supplies of foreign currency. These demands are being driven by a variety of uses.
The head of Nigeria’s central bank pointed out that the number of student visas issued by the United Kingdom to Nigerians has increased from an annual average of about 8,000 visas in 2020 to almost 66,000 visas in 2022, indicating an eight-fold increase that amounts to $2.5 billion annually in study-related forex outflow to the UK alone. The number of student visas issued to Nigerians by the United Kingdom has increased from an annual average of about 8,000 visas in 2020 to almost 66,000 visas
The RT200, a boost to foreign exchange inflow
According to Emefiele, the Central Bank of Nigeria (CBN) and the Bankers’ Committee initiated the RT200 scheme in February 2022 due to this issue and the necessity to raise foreign exchange earnings.
He stated that the primary goal of the scheme was to devise an inventive solution to the problem of repatriating the proceeds from exports of goods other than oil.
Emefiele pointed out that the programme brought in approximately $1.6 billion in 2022, which is expected to rise above $2.5 billion by the time this year comes to a close.
He said:
“Under the rebate scheme of the program, the Bank has reimbursed a total of N78.4 billion naira,” Emefiele said. “I consider this to be a fair price to incur in order to stabilise our foreign exchange market.””
Prior to the launch of the RT200, the Central Bank of Nigeria (CBN) undertook a number of different initiatives to increase the amount of foreign currency that entered Nigeria.
One of these initiatives was the Naira-for-Dollar program, which reflected the efforts of the Central Bank of Nigeria (CBN) to increase the amount of money that migrants sent back to their home countries.
Emefiele said:
“I am happy to note that, so far, the Naira-for-Dollar scheme has been successful in increasing remittance inflows through our registered International Money Transfer Organizations (IMTOs),” the president said. “This brings me great joy.”
National Domestic Card Scheme to start January 2023
According to Emefiele, the National Domestic Card Scheme is anticipated to reduce operating costs for banks that currently bear enormous charges for participating in foreign card schemes. Additionally, it would reduce the huge currency commitments that are associated with initiatives involving foreign credit cards.
The plan is scheduled to get underway on January 16, 2023. In addition, Emefiele mentioned that Nigeria would be joining a growing list of emerging markets and developing economies, such as India, Turkey, China, and Brazil, that have launched the domestic card scheme.
CBN, NIBSS move to unify payments through National Domestic Card scheme
It has been reported that the Central Bank of Nigeria (CBN), which is the most powerful bank in Nigeria, along with the Nigeria Inter-Bank Settlement System (NIBSS), which includes the Bankers Committee, will float a national card scheme to improve the payment system in Nigeria.
According to Vanguard, this information was provided by Premier Owoh, the Managing Director of NIBSS, during the meeting of the Committee that took place on Thursday, October 20, 2022.
According to Owoh, the project has been given the green light and was conceived of by CBN.
