Nigerian banks stop instant transfer from domiciliary accounts

Nigerian banks stop instant transfer from domiciliary accounts

- Nigerian banks have decided to end instant transfer to third parties from domiciliary accounts

- The banks said applicants must now provide documentation if they don't want their transfer application rejected

- The cancellation of instant transfer is being linked to scarcity of forex and the CBN's efort to control dollar movement

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Nigerian banks have stopped instant online transfers to third parties from a domiciliary account without proper documentation. The commercial banks have now informed customers to provide documents if they want their online transfer approved.

According to emails sent to bank account holders, the banks now request invoices, bills, and demand notes when processing third-party transfers for domiciliary accounts that house inflow of dollars and other foreign currency.

The deposit money banks warned that any customer who fails to provide the documentation will have their online application rejected in line with currency cut-off time. Foreign countries have a timeframe they allow processing of their currency.

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For Euro, the timeframe is 1.30pm, Pounds & others is 2.30pm and Dollars is 3.30pm, the email sent to customers stated. The new policy for domiciliary accounts won't after individuals or companies sending money to an account they own.

School fee payment, hospital bill and other third party transfers will be impacted according to the statement:

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“For Medical, insurance, school fees, subscriptions and other similar invisible payments. For transparency and in line with CBN eligibility requirement, purpose of payment must be clearly indicated for all international transfers in the narration section provided.”
Nigerian banks stop instant transfer from domiciliary accounts
Nigerian banks stop instant transfer from domiciliary accounts Photo: Tarik Kizilkaya, Eyegelb
Source: Getty Images

In the statement, it was said that backroom staff of commercial banks will be in charge of the process to determine which application or transfer should be processed from March 20, 2021.

The email reads in part:

“This is to inform you that instant completion for international transfers on our digital platforms will cease from March 20, 2021. All international third-party transfers initiated on any of our digital channels will be completed at the back office after receipt of relevant supporting documents.

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"Kindly ensure you send relevant supporting documents for your international transfers immediately transaction is initiated online.”

The new bank policy is said to target circulation of dollars outside the control of the Central Bank of Nigeria. The bank want to tighten its grip on the inflow of dollars and the usage within Nigeria and outside the country.

This is expected to impact the process of transaction, as customers have been making transfers without the bottleneck. The cancellation of instant transfer from domiciliary accounts is being done amid dollar scarcity.

This year, Nigeria's foreign external reserves have fallen by $632.9 million according to Nairametrics, settling at $34.74 billion as of early March, despite rise in crude oil, which is expected to increase the availability of forex.

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Meanwhile, Legit.ng earlier reported that Flutterwave co-founder, Iyinoluwa Aboyeji, said Nigerian gross domestic product could grow into a trillion-dollar economy.

Aboyeji said this during an interview with Digital Talks, where he spoke about the growth of Nigeria's tech space and the impact of Flutterwave on the Nigerian tech space.

Fakoyejo Olalekan is a Business and Financial Journalist with over three years of experience in covering finance and business activities within Nigeria and offshore. Prior to joining Legit.ng, he worked at Nairametrics where he wrote financial and investment analysis articles. Olalekan is a resourceful and result-driven journalist with a track record for conducting extensive research and interviews to produce articles that provide different perspectives to market activities.

Source: Legit.ng

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