Banks woo customers over incentive policy on Diaspora remittances

By Philip Clement

Following the recent directive by the Central Bank of Nigeria (CBN) on a N5 incentive for every dollar remitted into the country by Nigerians abroad, commercial banks operating in the country have started wooing their various customers to benefit from the two months cashback incentive.

The apex bank in a circular to all Deposit Money Banks and International Money Transfer Operators (IMTOs) stated that under the scheme, all recipients of diaspora remittances through the CBN-licensed IMTOs shall henceforth be paid N5 for every $1 received as inflow.

The circular with reference number TED/FEM/PUB/ EPC/01/003, which was signed by the Director, Trade and Exchange Department of the CBN, Dr O.S Nnaji, tagged “CBN Naira 4 Dollar Scheme.”

Given this effort by the CBN to sustain and encourage increase in inflows of Diaspora remittances into the country, commercial banks have started reaching out to customers over the N5 incentive.

For instance, Fidelity Bank in an email notice to its customers on Sunday said; “For every dollar, you receive via any of our International Monet Transfer (IMTO), you get N5 cashback, either into your Fidelity account or over the counter.

“Offer valid till May 8, 2021, the bank stated. Also, Guaranty Trust Bank (GTBank) in a text message to its customers yesterday said, “Dear Customer, we are giving you N5 for every Dollar you receive via Money Transfer Agents.

“Offer available at all GTBank branches nationwide and valid till 8th of May”, it stated. Meanwhile, the apex bank in the circular has explained that a typical recipient of Diaspora remittances will, at the point of collection, receive not only the dollar sent from abroad but also the additional N5 per dollar received.

The circular reads in part, “To sustain the encouraging increase in inflows of Diaspora remittances into the country, the Central Bank of Nigeria hereby announces the introduction of the ‘CBN Naira 4 Dollar Scheme’, an incentive for senders and recipients of International Money Transfers.

Accordingly, all recipients of diaspora remittances through CBN licensed IMTOs shall henceforth be paid N5 for every USD1 received as remittance inflow. “In light of this, the CBN shall, through commercial banks, pay to remittance recipients the incentive of N5 for every USD1 remitted by the sender and collected by the designated beneficiary.”

This incentive, according to the CBN, is to be paid to recipients whether they choose to collect the dollars as cash across the counter in a bank or transfer the same into their domiciliary account.

It said that having discussed with banks and IMTOs; the scheme takes effect from Monday, March 8, 2021, and ends on Saturday, May 8 2021. The World Bank had put the inflow of Diaspora remittance to Nigeria as of the end of 2019 at $23.8bn.

In another development, the apex bank resolved to encourage firms willing to invest in the Nigerian manufacturing sector to grow the economy.

Emefiele disclosed while hosting the signing of the Memorandum of Understanding (MOU) between Procter & Gamble (P&G) and Colori for the local production of its Oral Care products, Oral B, as part of efforts towards localization of production in Nigeria.

The partnership represents a new investment of $35million. According to him, the manufacturing industry in Nigeria remained a key focus of the efforts by the monetary and fiscal authorities towards driving recovery of the Nigerian economy, following the downturn due to the impact of the COVID-19 pandemic, hence the push for import substitution.

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“Our efforts have aided the recovery of the manufacturing sector as reflected in the Purchasing Managers Index which shows that the index on manufacturing activities rose from a low of 41 points in May 2020 to 49.6 points in December 2020,” Emefiele added.

Emefiele, therefore, encouraged multinational firms to emulate Procter and Gamble by considering the opportunities that Nigeria offers and begin to set up their manufacturing lines in Nigeria.

He also expressed the belief that this move would help to enable the country to build a more resilient economy that creates jobs and supports skills transfers for the nation’s growing and youthful population.