Who bears the cost of CBN’s new ‘naira settlement account’ rules for IMTOs?

On March 24, the Central Bank of Nigeria, CBN, quietly published a circular that will reshape how international money transfers flow, remittances, into the country.

The directive, signed by Dr Musa Nakorji, Director of the Trade and Exchange Department, instructed all International Money Transfer Operators (IMTOs) licenced to operate in Nigeria to open naira settlement accounts with authorised dealer banks and route every transaction strictly through those accounts.

The deadline is May 1, 2026, which gives operators just over five weeks to get in line.

On the surface, it reads like a routine compliance update. Underneath, it is a significant tightening of how the CBN monitors one of Nigeria’s most important sources of foreign exchange, and the consequences will travel further than the circular suggests.

The CBN’s bigger FX play

This directive does not stand alone. It is part of a broader, deliberate effort by the CBN to unify Nigeria’s foreign exchange market and pull dollar liquidity into channels it can actually see and price.

Fintech regulation in Nigeria

Nigeria received an estimated $20 billion in remittances in 2024, making diaspora inflows one of the country’s largest sources of foreign currency, comfortably ahead of many categories of export earnings.

The problem has always been visibility. A portion of that $20 billion has historically moved through informal or semi-formal channels, arriving in ways that bypass the official FX market entirely.

When the CBN cannot see the dollar, it cannot price it, and when it cannot price it, the gap between the official rate and street reality widens.

The new framework closes several of those gaps at once. By requiring all inflows, disbursements, and related settlements to pass through designated naira accounts at authorised dealer banks, the CBN creates a paper trail for every dollar that enters through a licenced IMTO.

The additional requirement that IMTOs benchmark their rates using the Bloomberg BMATCH system is equally significant. It pushes pricing into a transparent, real-time reference framework, reducing the information gap between operators and banks that has long allowed rates to drift in ways that benefited some players and hurt others.

What this costs remittance operators

The compliance burden is not trivial. IMTOs now need dedicated banking relationships with authorised dealer banks, properly designated accounts, documented transaction records, and full alignment with anti-money laundering and counter-terrorism financing requirements.

For large, well-capitalised operators with existing banking infrastructure, this is manageable, an administrative adjustment rather than a structural challenge.

For smaller IMTOs, the calculation is different. Building and maintaining the banking relationships this directive requires takes time and money. Routing every transaction through a single designated framework adds operational layers that lean teams are not always equipped to handle quickly.

The May 1 deadline is tight, and operators that cannot meet it face the choice of scrambling to comply or stepping back from the Nigerian market entirely.

If smaller operators exit, the corridor becomes more concentrated. Fewer players competing for Nigeria’s remittance volume typically means less pressure on fees and rates, and that pressure tends to flow in one direction.

The person receiving money in Kano feels this last

Nigeria’s remittance market is ultimately about people.

Behind every dollar moving through an IMTO is a family member in the UK, Canada, or the United States sending money to cover school fees, medical bills, or household expenses.

The cost of that transfer, and the rate at which naira lands on the other end, determines how much value actually reaches the recipient.

If IMTOs absorb compliance costs without adjusting their pricing, margins shrink and some will not survive it. If they pass those costs downstream through wider spreads or higher fees, the sender pays more, the recipient gets less, or both.

Neither outcome is what the CBN intends, but both are plausible in a market where the adjustment period is measured in weeks

The CBN’s goals here are legitimate. Greater transparency in remittance flows, better price discovery, and stronger regulatory visibility over cross-border inflows are all things Nigeria’s FX market genuinely needs.

The question is whether the May 1 deadline gives the market enough time to reorganise without pushing costs onto the people the system is supposed to serve.

The post Who bears the cost of CBN’s new ‘naira settlement account’ rules for IMTOs? first appeared on Technext.