Nigeria’s International Money Transfer Operator (IMTO) inflows surged by 44.5% in 2024, reaching $4.76 billion compared to $3.30 billion in 2023, according to the Central Bank of Nigeria’s (CBN) quarterly statistical bulletin. This growth, driven by reforms under CBN Governor Olayemi Cardoso since September 2023, reflects a robust increase in remittances, a critical source of foreign currency for Nigeria’s economy. Key reforms include:
- Removal of Exchange Rate Caps: In January 2024, the CBN lifted the ±2.5% cap on IMTO exchange rates, allowing market-driven pricing, which boosted competition and inflows.
- Revised IMTO Guidelines: The CBN raised the IMTO license application fee from ₦500,000 to ₦10 million (a 1,900% increase) and set a $1 million minimum operating capital requirement for both foreign and local IMTOs.
- Access to Official FX Market: A circular allowed IMTOs to trade foreign exchange on the official market, reversing prior restrictions and improving liquidity.
- Collaborative Task Force: The CBN and IMTOs formed a task force reporting to Cardoso to double remittance inflows through diaspora engagement and transparency.
- New IMTO Licenses: The CBN granted 14 Approvals-in-Principle (AIPs) to new IMTOs, enhancing the remittance ecosystem.
Monthly data shows consistent growth: January 2024 inflows rose 32.5% to $390.86 million, February surged 67.3% to $326.91 million, March increased 30% to $363.76 million, and April saw an 83.3% jump to $466.11 million. Later months showed even stronger gains, with July and August more than doubling year-on-year to $552.94 million and $585.21 million, respectively.
However, some sources report a 63.7% increase in inflows for the first nine months of 2024, reaching $3.82 billion from $2.33 billion in 2023, suggesting potential discrepancies in full-year estimates or data reporting periods. The $4.76 billion figure aligns with Nairametrics’ year-end estimate, indicating robust growth despite global economic challenges.
These inflows bolster Nigeria’s foreign exchange reserves, which grew by nearly $8 billion to $40.9 billion by December 2024, enhancing FX liquidity and supporting the naira. Analysts attribute the surge to improved confidence in formal channels, driven by the naira’s float and reduced parallel market premiums. However, risks like global macroeconomic shocks could threaten sustained growth, as seen during the 2020 pandemic when remittances fell 28%.
The reforms have made IMTOs, like Western Union and Flutterwave, more attractive for diaspora remittances, which now account for 24% of Nigeria’s $15.9 billion in total remittances for 2024, up from 16% in 2023. This trend supports household incomes and economic stability, positioning Nigeria as Africa’s top remittance recipient.
