Nigeria Sees 200% Growth in Diaspora Remittances, Boosting Foreign Exchange
- In the past two months, remittances from Nigeria's diaspora have surged by 200%, reaching $600 million
- The governor of the CBN, highlighted that this increase is helping diversify the country's foreign exchange portfolio
- He also projected that remittances could reach at least $1 billion by the end of the year, with improvements in remittance channels
Legit.ng journalist Zainab Iwayemi has 5-year-experience covering the Economy, Technology, and Capital Market.
In the last two months, remittances from Nigeria's diaspora have increased by 200 percent to $600 million.
Source: Getty Images
According to Mr. Olayemi Cardoso, the governor of the Central Bank of Nigeria (CBN), who made this announcement yesterday, Nigeria's foreign exchange profile is significantly improving.
Speaking in São Paulo, Brazil, at the Delta State-Brazil Business and Investment Roundtable, Cardoso stated that the monthly inflows had increased from roughly $200 million to $600 million over the last two months, with estimates that they would reach at least $1 billion by the end of the year.
He emphasised that Nigerians living overseas no longer require alternative means of sending money home due to the improvement of remittance channels and the strengthening of the currency rate.
He claimed that Nigeria's foreign exchange portfolio was becoming more diversified and less dependent on oil earnings as a result of the growing diaspora flows.
He stated: “Our exchange rate is becoming a lot more competitive. And those who used to feel, especially the diasporans, who used to feel, 'Oh, we have to look for another channel, another means to send our money back home,' no longer have to do so.
“When we started looking at diaspora flows as a potential source of diversifying our foreign exchange flows, people laughed, and we found that we started off at about $200 million every month.
“In the last two months, the last count, we had reached $600 million per month. And by next year, we anticipate that we will be getting at least $1 billion from our diaspora folks at home.
“So I am saying this because it is also important to understand that these flows help diversify our foreign exchange portfolio.”
Source: Getty Images
The Central Bank of Nigeria disclosed earlier that the country’s external reserves rose to $41.22 billion as of Tuesday, August 26, 2025. This marks the first time in over four years that the reserves have crossed the $41 billion mark.
The reserves, which strengthen the CBN’s capacity to defend the naira, stood at $41.00 billion on August 19, 2025, representing a year-on-year increase of $4.53 billion, or 12.4%, from $36.47 billion on the same date in 2024.
The last time reserves reached this level was on March 12, 2021, when they hit $41.08 billion. Analysts at FBNQuest said in a note that foreign exchange inflows into Nigeria’s FX market regained momentum in July, reflecting renewed investor appetite.
According to FMDQ data, inflows increased 24% month-on-month to $3.8 billion in July, compared with $3.1 billion in June, although still below the $6.7 billion peak in May.
US to impose tax on diaspora remittances
Legit.ng reported that the United States have introduced a bill proposing a five per cent excise tax on all remittances sent abroad.
The bill was unveiled by the US House of Representatives on Monday, May 12, 2025, targeting financial transfers from US residents to recipients abroad.
Experts have said that the bill will affect Nigeria’s foreign exchange inflows from the US, as it heavily relies on diaspora remittances.
Source: Legit.ng
