Banks have up to 24 hours to meet all foreign exchange requests for Personal Travel Allowances (PTA) and Business Travel Allowances (BTA), the Central Bank of Nigeria (CBN) has directed.
The maximum volume of BTA approved for sale per customer is $5,000 quarterly. A PTA customer gets $4,000.
The CBN also announced at the weekend a 48 hours timeline for banks to meet all foreign exchange requests for school fees (including allowances) and medical bills applications. The regulator expects such retail transactions to be settled at a rate not exceeding 20 per cent above the interbank market rate or at N375 to the dollar.
A circular to all authorised dealers signed by CBN Director, Financial Markets Department, Alvan Ikoku, said the new timeline was meant to increase foreign exchange liquidity in the market, and ensure availability to end-users.
The CBN also directed commercial banks to open teller points in all locations to ensure access to foreign exchange by their customers.
The banks were warned that non-compliance with the directives would attract sanctions, including but not limited to being barred from all CBN foreign exchange interventions.
According to the circular, lenders are also expected to have electronic display boards in all their branches showing rates of all traded currencies.
โBanks are hereby directed to process and meet the demand for Personal Travel Allowances and Business Travel Allowances customers within 24 hours of such applications. They are to equally process and meet the demands for school fees (including allowances) and medical bills within 48 hours of such applications,โ the circular said.
The CBN has been implementing a new foreign exchange policy, which makes greater provisions for commercial banks to get more dollars to fund forex users at the retail end of the market. The apex bank has subsequently increased its level of interventions in the interbank market where it constantly injects dollars to raise market liquidity and stabilise the naira.
โHaving cleared the historic backlog of matured letters of credit at the inception of the current flexible exchange rate system, the CBN would immediately begin to provide foreign exchange to all commercial banks to meet the needs of both PTA and BTA for onward sale to customers. All banks would receive amounts commensurate with their demand per week, which would be sold to customers who meet usual basic documentary requirements,โ the CBN said.
The CBN had earlier promised to meet the needs of parents, guardians and sponsors for school fees. Such payments must be made by commercial banks directly to the institution specified by the customer.
The apex bank also promised to ensure that this process is as smooth as possible and that as many customers as possible get the foreign exchange they genuinely demand.
The new foreign exchange rules will also apply to customers seeking to make payments or purchase foreign exchange for medical bills and paid directly to hospitals. The supply of foreign exchange to retail end-users will be sustained by the CBN.
The CBNโs objective is to continuously and vigorously pursue a transparent, liquid and efficient foreign exchange market. The regulator said it would neither tolerate unscrupulous actions nor hesitate to impose sanctions on offenders, be they banks or their staff.
The CBN urged market participants to assist in ensuring that these new measures engender the preservation of our external reserves, stability of the financial system, and growth of the economy to the benefit of all Nigerians.
