$21b diaspora remittance: The odds against banks – Guardian

Allegations and affirmed breaches of rules by banks are currently working against their quest to remain the sole administrator of the estimated $21 billion yearly diaspora remittances. For a fact, they have been enmeshed in controversies in recent times.

A regulatory source had told The Guardian that the new rule on International Money Transfer Operators was necessitated to foil banks collaborations with illegal money transfer operators. Even at the, Bureau De Change Operators recently raised the alarm that majority of them were not disbursing the remittances to their members as directed by the Central Bank of Nigeria (CBN). The disbursements were also delayed for weeks after payment.

Before now, there were allegations that some of them were participating actively in the newly inaugurated flexible exchange rate policy at the interbank, raising speculations that the regulator would soon delist the culprits from their rank of dealership.

Just few weeks ago, nine banks’ failure to remit $2.3 billion belonging to the Nigeria National Petroleum Corporation (NNPC)  and Nigeria LNG into the Treasury Single Accounts (TSA) jolted the system. But more worrisome was when the affected banks were alleging that they were not punished equally, as no fewer than six more banks were also involved, but not mentioned.

Now, these cases are raising questions over their propriety and credibility to continue to receive and disburse $21 billion Diaspora remittances to BDC operators. Now, top of the options is manifest in the mounting calls by stakeholders for the apex bank to outsource the dollar distribution role to a reputable independent distributor that would make the funds readily accessible to the BDCs. This, they insist, would strengthen the foreign exchange market.

According to a report, analysts at Lagos-based CSL Stockbrokers Limited predicted a damning consequences, just like other financial experts, in form of fines, with some estimating about N450 million on all the erring lenders cumulatively, although there was no precedence of the case.

Read more at http://guardian.ng/business-services/21b-diaspora-remittance-the-odds-against-banks/