Nigeria Lifts Restrictions on Foreign Currency Transactions, Enables Greater Flexibility

The Central Bank of Nigeria (CBN) has implemented a significant change in the country’s monetary policy by removing cash deposit limitations on domiciliary accounts, thus granting account holders the freedom to withdraw up to $10,000 per day.

This decision marks a noteworthy development in Nigeria’s financial landscape, as it empowers individuals with greater flexibility in managing their funds held in domiciliary accounts. The CBN arrived at this decision during an extraordinary Bankers’ Committee meeting, during which discussions on the policy changes’ implementation and implications took place. The newly issued directive provides banks with clearer guidance on operational adjustments within the foreign exchange market, with the objective of fostering transparency, liquidity, and price discovery.

Previously, individuals with domiciliary accounts encountered restrictions on the amount of cash they could deposit and withdraw, presenting obstacles to international transactions. Domiciliary accounts are specialized bank accounts that facilitate the holding and transacting of funds in foreign currencies.

This easing of restrictions by the CBN is expected to facilitate smoother cross-border transactions and enhance financial flexibility for Nigerians. It reflects a commitment to improving the accessibility and efficiency of foreign exchange operations in the country, ultimately fostering a more robust and transparent financial ecosystem.