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  • Banks’ll Increase Credit To Economy in 2022, Says CBN

    Banks’ll Increase Credit To Economy in 2022, Says CBN

     

    The Governor of the Central Bank of Nigeria, CBN, Godwin Emefiele, has said the banking sector will increase access to finance and credit for households in 2022.

     

    Emefiele said this recently in Lagos, according to a statement on Thursday.

     

    “The policy focus of the bank for 2022 is with a pledge to sustain improved access to finance and credit for households and businesses, mobilise investment to boost domestic productivity, enable faster growth of non-oil exports, and support employment generating activities,” he said.

     

    He noted that the country had been able to contain some of the effects of the COVID-19 pandemic on the economy.

     

    He stressed the need for all stakeholders to work to build a more resilient economy that would be better able to contain external shocks, while supporting growth and wealth creation in key sectors of our economy.

     

    According to him, a major lesson from the COVID-19 pandemic was that deliberate efforts must be made to diversify the base of the Nigerian economy.

     

    Emefiele said the country must do everything possible to reduce the importation of goods into the country.

     

    “Proactive steps on the part of stakeholders in the private sector, in collaboration with the government in supporting the growth of sectors such as manufacturing, ICT, and infrastructure, will strengthen our ability to deal with the challenges of COVID-19, and stimulate further growth of our economy,” he added.

     

    Speaking on the need to build an efficient infrastructure ecosystem in Nigeria and the role of improved infrastructure to the development of the Nigerian economy, he disclosed that all necessary approvals had been obtained for the full commencement of the Infrastructure Corporation in early 2022.

     

  • Embrace E-Naira Like Physical Naira, CBN Urges Nigerians

    Embrace E-Naira Like Physical Naira, CBN Urges Nigerians

     

    The Central Bank of Nigeria (CBN) has appealed to Nigerians to embrace the bank’s digital currency, eNaira just like the physical Naira, which it described as the nation’s pride.

     

    The Director, Corporate Communications Department at CBN, Mr. Osita Nwanisobi stated that eNaira, like the physical Naira is a legal tender in Nigeria and a liability of CBN.

     

    The eNaira was launched by President Muhammadu Buhari on October 25, 2021.

     

    Nwanisobi who spoke during the CBN Special Day at the ongoing 35th edition of Lagos International Trade Fair, said, “Since the eNaira platform went live, there has been overwhelming interest and encouraging response from Nigerians and other parties across the world. Today, customers who download the eNaira Speed Wallet App will be able to Onboard and create their wallet; fund their eNaira wallet from their bank account; transfer eNaira from their wallet to another wallet and make payment for purchases at registered merchant locations.”

     

    President of the Lagos Chamber of Commerce and Industry (LCCI), organisers of the trade fair, Mrs. Toki Mabogunje commended the launch of the eNaira, saying, it marks a milestone in Nigeria digital economy. 

     

    Nigeria’s trade with the rest of the world, she said, is expected to receive a boost with the launch of the digital currency.

     

    She however stressed the need for massive awareness campaigns to tell potential users of the benefits of the operational, cybersecurity implications and its operationalization with other traditional currencies.

  • Merchants, Businesses Must Accept e-Naira Anywhere It’s Presented – CBN 

    Merchants, Businesses Must Accept e-Naira Anywhere It’s Presented – CBN 

    The Central Bank of Nigeria has stated that the e-naira which will be launched on October 1, is a legal tender equal to the naira and must be accepted as a form of payment by all merchants and business establishments. 

     

    Mr. Musa Jimoh, the CBN Director of Payment System Management, stated this during an appearance on Channels Television’s “Business Morning.”

     

    Jimoh said, “Today, anywhere you present naira to pay, compulsorily it must be accepted because that is our fiat currency. So, the same way naira is accepted that you can’t reject it, is the same way e-naira must be accepted. Anywhere in this country where e-naira is presented, it must be accepted. So, merchants must accept e-naira as a means of payment.”

     

    He recommended that Nigerians should open e-naira wallets, which can be downloaded on mobile phones starting October 1, and said the Central Bank of Nigeria (CBN) was responsible for all liabilities.

     

     “The liability of the e-naira money is directly on CBN which is similar to the cash you hold. The liability of the cash you hold today rests with the CBN. So, it gives Nigerians the opportunity to bank with CBN,” Jimoh said.

     

     What you should know

     

    Nigeria’s Central Bank planned to own a stake in Bitt Inc. It was stated that one of the conditions being considered for accepting Bitt Inc was for the company to register in Nigeria as a Limited Liability company allowing the central bank to own shares in its Nigerian entity.

     

    Bitt is a financial technology business that uses blockchain and distributed ledger technology to enable safe peer-to-peer transactions with seamless mobile money across Bitt’s software and mobile apps.

     

    The Governor of the Central Bank of Nigeria has stated that Bitt Inc, the company developing the country’s digital currency, eNaira, is not his company.

     

    The Central Bank of Nigeria (CBN) has announced that the Nigerian International Financial Centre (NIFC) will be established to act as a gateway for funds and investments into the country.

  • e-Naira Will Strengthen Banking System, CBN Reassures

    e-Naira Will Strengthen Banking System, CBN Reassures

     

    The Central Bank of Nigeria, CBN, has said e-Naira will strengthen the banking system and make it easier to comply with existing laws such as anti-money laundering, customer protection against fraud and ensuring the safety and stability of the payment system.

     

    The Deputy Governor Operations, Central Bank of Nigeria, Mr Folashodun Shonubi, said this at the Chartered Institute of Bankers of Nigeria advocacy series webinar held recently.

     

    Shonubi said, “The Central Bank in its implementation has ensured the e-Naira feeds our economy and provides greater value.

     

    “The central bank digital currency offers all the benefits of cash but in digital form. Every single digital currency is an electronic version of the cash, the legal tender. When you make a cash payment, settlement is done instantly; digital currencies entail the same promises and even more.”

     

    He added, “CBDC offers a safer option from the privately issued cryptocurrency which have been based on the possibility to enable cheaper transactions but have now been used for investment.

     

    “The intention is not to eliminate other forms of payment but to complement the current areas of payment options, thereby ensuring the stability of the payment system in the long run. I expect in the coming days we will see rapid inclusion rates.

     

    “For banks in developing nations, it will enhance their liquidity, efficiency in national remittances and challenge the high cost of remittances as the world rebounds in the post-pandemic.

     

    “I am of the view that the era of CBDC promotes greater opportunities, and the central bank must be aware of the risks and mitigate them.”

     

    On his part, Director-General of the Securities and Exchange Commission, Mr Lamido Yuguda said, “The pilot project on the E-Naira is about to be launched in October. People would want to position their digital currencies in such a way that many other users, beyond their borders, would use this particular currency.”

     

    Yuguda said that the digital currency would help improve the capital market when combined with vibrant inter-developmental policies, which would lead to financial inclusion, especially in the capital market.

     

    He added, “This is an opportunity for the fintech market to connect our people to existing opportunities in the financial market, connecting our people with investment opportunities in other climes. Once we do that, we would grow our market, Nigeria has 200 million people. We are blessed with a hardworking youthful population.

     

    “This capital market would in turn finance the necessary infrastructure investment that this country needs today.”

     

    President, Fintech Nigeria, Ade Bajomo, said “The digital currency brings the opportunities to reduce poverty and increase financial inclusion. There are opportunities in terms of resilience, accelerating cross border payment, and promoting financial inclusion.”

     

    Bajomo added that it provided an opportunity to explore the Fintech and the digitalisation of Nigeria and empower innovators and financial services companies to innovate.

     

  • Return Unused Forex In Two Weeks, CBN Orders Travellers

    Return Unused Forex In Two Weeks, CBN Orders Travellers

     

    Travellers who buy foreign exchange from banks for travel purposes but fail to embark on the trip two weeks after their scheduled travel date must return the forex to the banks, the Central Bank of Nigeria has said.

     

    First Bank of Nigeria disclosed this in an email to its customers titled ‘Adherence to forex sale policy’.

     

    It said, “We have been directed by the Central Bank of Nigeria to inform all our customers that unethical practices to circumvent the new CBN policy on the sale of forex, such as the presentation of false travel documents, visas, and the cancellation of flight tickets after purchasing personal travel allowance and business travel allowance, will no longer be tolerated.

     

    “Defaulting customers who present fraudulent travel credentials or cancel their tickets and fail to refund the purchased PTA and BTA within two weeks, as stated in the signed customer declaration form, will have their identities and bank verification numbers published.

     

    “We aim to implement this policy immediately as an organisation that is fully compliant with the Central Bank of Nigeria’s rules and regulations.

     

    “Our bank is committed to partnering with the CBN to ensure a transparent, efficient and stable FX Market that meets the needs of all legitimate users.”

     

  • Just In: CBN Pegs Transfer Limits To N50k As E-Naira Takes Off October 1

    Just In: CBN Pegs Transfer Limits To N50k As E-Naira Takes Off October 1

     

    The Central Bank of Nigeria (CBN) has set an initial transaction limit of N50,000 for non- account preparatory to the take-off of its digital currency set for October 1.

     

    In a guide released by the apex bank to Deposit money banks, the CBN stipulated a transaction limit for customers, non-interest-bearing Central Bank Digital Currency (CBDC) status, and an account value limit.

     

    There are three levels to the CBN “Speed wallet” issued primarily to meet the October 1, 2021, deadline.

     

    As a means to transact value, the wallet doesn’t compete with existing banks but is awaiting the creation of wallets by banks and other innovators.

     

    Tier one

     

    With the first tier, Speed Wallet can be used by anyone who does not have a bank account. However, users will have to submit a passport photo, a name, birth date and place, a phone number, and their address.

     

    A N50,000 limit is in place for “Send & Receive”. The minimum requirement is the individual’s National Identity Number (NIN), which will be validated. A cumulative balance of N300,000 is fixed each day.

     

    Tier Two

     

    An account with an existing bank is required for users of Tier Two wallets.

     

    The user is limited to sending and receiving N200,000 per day with a Cumulative Balance of N500,000 daily. A Bank Verification Number (BVN) is the minimum requirement for this level.

     

    Tier Three

     

    Tier three allows daily transactions of N1 million, with daily cumulative balances of N5 million. In order to qualify, you need to have at least a BVN.

     

    Those who possess this merchant level can send or receive a million naira daily. A merchant can move as much money as they want into their bank accounts.

     

    However, In context, the Central Bank further disclosed, neither merchants nor customers using the wallet will be charged a fee.

     

    The report stated that the e-Naira is a legal tender for the entire country. It also mentioned that it will have non-interest-bearing CBDC status, a transaction limit for customers, and a value-based transaction limit.

     

    The CBN also outlined that Nigerian banks will be allowed to invite all their customers to register for the e-Naira.

     

    “Besides pre-generated codes, the banks can send invitation codes for onboarding to a specific list of selected customers. Onboarding will be done for customers who have a code assigned by their banks. The banks have already validated and verified these customers.”

     

    It further disclosed that the wallet provided by its institution was merely a stop-gap measure for meeting the deadline, given that banks and other licensed operators may provide their own wallets since it didn’t intend to compete against the banks.

     

    “As a National Critical Infrastructure, the e-naira system will be subject to comprehensive security checks, all data and personally identifiable information (PII) will be kept off the ledger and will not be stored on the ledger,” the Apex bank added.

     

    In order to catalyse the adoption of e-Naira, banks will facilitate onboarding and provide world-class customer service.

     

     

  • CBN Directs Banks To Block 18 Companies’ Accounts

    CBN Directs Banks To Block 18 Companies’ Accounts

     

    The Central Bank of Nigeria, CBN, has directed banks to place a post-no-debit restriction on the bank accounts of 18 companies.

     

    This implies that all debit transactions, including Automated Teller Machines and cheques, on these accounts, have been blocked but can receive inflows.

     

    The directive was contained in a circular dated August 18 and signed by the Director of Banking Supervision, CBN, Haruna Mustapha, according to TheCable.

     

    The circular read in part, “You are hereby directed to place all accounts of the under-listed customers on Post-No-Debit restriction.”

     

    TheCable stated that the affected companies include “Bakori Mega Services, Ashambrakh General Enterprise, Namuduka Ventures Limited, Crosslinks Capital and Investment Limited, IGP Global Synergy Limited, Davedan Mille Investment Limited and Urban Laundry.

     

    Others are, “Advanced Multi-Links Services Limited, Spray Resources, Al-Ishaq Global Resources Limited, Himark Intertrades, Charblecom Concept Limited, Wudatage Global Resources, Treynor Soft Ventures, Fyrstrym Global Concepts Limited, Samarize Global Nigeria Limited, and Zahraddeen Haruna Shahru.

     

    The report also notes that the apex bank did not provide any reason for the action in the circular.

     

    However, the affected accounts belong to bureaux de change, construction firms, investment companies, laundering services, and property companies.

     

    Meanwhile, the CBN has cautioned microfinance banks against performing certain non-permissible activities, which include wholesale backing and foreign exchange transactions.

     

    This was contained in a circular titled, ‘Circular to all microfinance banks,’ released on Friday by Ibrahim Tukur on behalf of CBN’s Financial Policy and Regulation Department.

     

    The circular read, “The Central Bank of Nigeria has observed the activities of some Microfinance Banks that have gone beyond the remit of their operating licence by engaging in non-permissible activities, especially wholesale backing, foreign exchange transactions and others.

     

    “Given the comparatively low capitalisation of MFBs, dealing in wholesale and/or foreign exchange transactions are a significant risk with dire consequences for financial system stability.

     

    “It has therefore become imperative to remind all MFBs to strictly comply with the extant Revised Regulatory and Supervisory Guidelines for Microfinance Banks in Nigeria 2012.”

     

    The apex bank warned that it would continue to monitor developments in the MFB sector and apply stringent regulatory sanctions for violations of extant regulations, including revoking licences.

     

  • SERAP Drags FG to Court Over ‘$25bn Overdraft Taken From CBN’

    SERAP Drags FG to Court Over ‘$25bn Overdraft Taken From CBN’

     

    The Socio-Economic Rights and Accountability Project (SERAP) says it has filed a lawsuit, asking the court “to compel the federal government to disclose details of a $25 billion (N9.7trn) overdraft reportedly obtained from the Central Bank of Nigeria (CBN).

     

    In a statement on Sunday, Kolawole Oluwadare, SERAP’s deputy director, said the group also asked the court to ask the government to disclose spending details of the overdrafts and loans obtained from the apex bank since May 29, 2015.

     

    Oluwadare said the suit followed SERAP’s freedom of information (FoI) request to President Buhari to disclose the overdraft and repayment plan details.

     

    He added that ensuring transparency and accountability in the spending of CBN overdrafts and loans would promote prudence in debt management, reduce any risks of corruption and mismanagement, and help the government to avoid the pitfalls of excessive debt.

     

    “Transparency and accountability in the spending of CBN overdrafts would also ensure that public funds are properly spent, reduce the level of public debt, and improve the ability of the government to invest in essential public goods and services, such as quality education, healthcare, and clean water,” SERAP said in a statement.

     

    “It is the primary responsibility of the government to ensure public access to these services in order to lift millions of Nigerians out of poverty and to achieve the Sustainable Development Goals by 2030.

     

    “Transparency and accountability in the spending of CBN overdrafts and loans would also improve the ability of the government to effectively respond to the COVID-19 crisis. This means that the government would not have to choose between saving lives or making debt payments.

     

    “The recent overdraft of $25.6bn (about N9.7trn) reportedly obtained from the CBN would appear to be above the five-percent limit of the actual revenue of the Federal Government for 2020, that is, N3.9trn, prescribed by Section 38(2) of the CBN Act 2007. SERAP notes that five-percent of N3.9trn is N197bn.

     

    “While Section 38(1) of the CBN Act allows the Bank to grant overdrafts to the Federal Government to address any temporary deficiency of budget revenue, sub-section 2 provides that any outstanding overdraft ‘shall not exceed five-percent of the previous year’s actual revenue of the Federal Government.”

     

    “Similarly, Section 38(3) requires all overdrafts to ‘be repaid as soon as possible and by the end of the financial year in which the overdrafts are granted.’”

     

    SERAP said Abubakar Malami, the attorney general of the federation and minister of justice, Zainab Ahmed, minister of finance, budget and national planning, and Godwin Emefiele, CBN governor, are joined in the suit.

     

    The anti-corruption group said the court actions are brought in the public interest and in line with the Nigerian Constitution, the freedom of information act, the fiscal responsibility act, the Central Bank Act; the Debt Management Office Act; and the country’s international legal obligations.

     

    No date has been fixed for the hearing of the suit.

  • CBN Provides N240bn For Power Firms’ Emergency Expenditure

    CBN Provides N240bn For Power Firms’ Emergency Expenditure

     

    The Central Bank of Nigeria is providing N240bn in emergency capital expenditure for interface repairs and network improvements by power firms, the Federal Government has said.

     

    It was gathered that the fund was being invested by the bank to also help in boosting the capacities of power distribution companies to distribute electricity.

     

    After the unbundling of the defunct Power Holding Company of Nigeria in November 2013, a total of 11 distribution companies and six generation companies emerged and were handed over to private investors.

     

    Despite being privatised, there had been liquidity concerns in the sector, a development that had made the government intervene by pumping funds into the industry often.

     

    In a document entitled ‘Update on the Nigeria Electricity Supply Industry,’ obtained from the Federal Ministry of Power in Abuja on Friday, the Federal Government stated that it was again supporting power firms through the CBN with N240bn.

     

    Under the investment section in the document, the government said, “N240bn in emergency CAPEX (capital expenditure) provided by the CBN for interface repairs and (for) Discos in network improvements.”

     

    The government, however, stated that it had recorded return of investment with the N105bn Afam III, IV, V power plants sale, and the disposition of Yola Disco at N19bn.

     

    It said there had been an Expression of Interest in the Zungeru power plant.

     

    On some of the headwinds in the NESI as contained in the document, the government explained that macroeconomic factors such as changes in foreign exchange rate were impacting on cost reflective tariff in the power sector.

     

    It described the impact of inflation as limited but rising, adding that the delays in implementation of gas pricing might impact electricity tariff in July.

     

    On the pace of capital expenditure investments, the government observed that there was a need to boost power supply in order to limit tariff impact, as the CAPEX investments inaugurated in June should be accelerated.

     

    “The capacity of the market to spend/absorb CAPEX funds needs to ramp up,” the power ministry said.

     

    On labour matters, the ministry said progress was being made with the joint Federal Government-labour committee on agreement to ensure that minor (tariff) reviews continued on time.

     

    It said the implementation committee engagements had been positive thus far but noted that there was still the need for continued monitoring.

     

    The power ministry stated that insecurity had been a challenge in some areas in the North, as it stated that it was encountering challenges in power supply to Borno and its environs due to vandalism by insurgents.

     

  • CBN Sacks All First Bank Holdings Directors, Reinstates Sola Adeduntan As MD

    CBN Sacks All First Bank Holdings Directors, Reinstates Sola Adeduntan As MD

     

    The Central Bank of Nigeria (CBN) has reinstated Sola Adeduntan as the Managing Director And Chief Executive Officer of First Bank of Nigeria Limited.

     

    Godwin Emefiele, Governor of the CBN, announced this during a press briefing on Thursday.

     

    He also ordered the immediate removal of all directors of FBN Limited and FBN Holdings Plc.

     

    Emefiele directed the constitution of an interim board to clean up and stabilise the tier-1 lender.

     

    The apex bank appointed Remi Babalola as the interim chairman of FBN Holdings Plc, while other members appointed include, Peter Aliugo, Fatade Oluwole, Kofo Dosekun, Remi Lasaki, Alimi Abdulrasaq, Ahmed Modibo, and Khalifa Iman.

     

    The CBN, however, directed U.K. Eke to remain as the Group Chief Executive Officer of FBN Holdings Plc.

     

    Tunde Hassan-Odukale is the new chairman of First Bank Limited; other members include Tokunbo Martins, Uche Nwokedi, Adekunle Sonola, Isioma Ogodazi, Ebenezer Olufowose, Ishaya Dodo, Sola Adeduntan as managing director, Remi Oni, Gbenga Sobo and Abdullahi Ibrahim.

     

    On Wednesday, the CBN had queried the board of First Bank of Nigeria Limited over the removal of Sola Adeduntan, without due consultation with regulatory authorities.

     

    “The CBN was not made aware of any report from the board indicting the managing director of any wrong-doing or misconduct; there appears to be no apparent justification for the precipitate removal,” the letter signed by Haruna Mustafa, CBN’s director of banking supervision, read.

     

    “We are particularly concerned because the action is coming at a time the CBN has provided various regulatory forbearances and liquidity support to reposition the bank, which has enhanced its asset quality, capital adequacy and liquidity ratios amongst other prudential indicators.

     

    “It is also curious to observe that the sudden removal of the MD/CEO was done about eight months to the expiry of his second tenure, which is due on December 31, 2021.”

     

    Speaking during the press briefing, Emefiele said the apex bank suspected that the board removed Adeduntan because he took some decisions which were not in line with the major shareholders of the bank “who felt hurt and felt he should be removed”.

     

    “This is a bank were depositors’ fund is almost 10 times shareholders’ fund, our interest is to protect depositors and minority shareholders who have no voice in this business. We will not sit idle and allow this to continue,” Emefiele said.

     

    “I spoke to Mr. Oba Otudeko (chairman of First Bank Holdings), he refused to grant my entreaties. I had to call two of his major shareholders to call him to ask the board not to take such decisions without the approval of the CBN. He refused to pick the calls of these shareholders — who are also owners of the bank.

     

    “I called him the second time, I heard on another phone one of the shareholders begging him not to take that decision, he insisted on taking that decision. I sent the shareholder back to the office of Mr. Oba Otudeko to appeal to him to suspend the decision, he refused to see the shareholder. I feel we have done our best and we would not allow a shareholder who cannot subject himself to regulatory control and authority to remain as the director of a bank.”