Nigeria’s Diaspora Remittances Rise To $5.16bn In Q1, 2022 – CBN

Nigeria’s diaspora remittances continued its upward trend in the first quarter of the year, Q1’22, rising by 20.3 per cent, Year-on-Year, YoY, to $5.16 billion from $4.29 billion in the same period of last year, Q1’21.

Data from the Central Bank of Nigeria, CBN, shows that remittances from Nigerians working abroad have been on the upward trend since the third quarter of 2020.

On a Quarter-on-Quarter basis, QoQ, remittances rose by 2.6 per cent in Q1’22 from $5.03 billion in Q4’21. This represents the seventh consecutive quarterly increase in diaspora remittances.

Reflecting the impact of the economic lockdown to contain the spread of COVID 19 pandemic, diaspora remittances into the country fell sharply by 32 per cent QoQ to $3.84 billion in Q1’2020.

In a bid to forestall this trend, the CBN in December 2020 introduced measures to encourage Diaspora Nigerians to send their remittances through the banking system.

Among other things, the measures allow beneficiaries to have unfettered access and utilization to foreign currency proceeds, either in foreign exchange cash and/or in their Domiciliary Accounts.

Furthermore, the CBN directed payment switching and processing companies to stop local currency transfer of diaspora remittances received through International Money Transfer Operators (IMTOs).

The apex bank also directed Mobile Money Operators (MMO) to disable wallets from receipt of funds from IMTOs.

To complement these measures, the CBN in February 2021 introduced the “Naira4Dollar” scheme, which rewards beneficiaries of remittances with N5 for every $1 of remittance sent through the banks.

These measures according to the World Bank helped Nigeria achieve 11.4 per cent YoY growth to $19.2 billion in 2021.

While also projecting 7.0 per cent increase in remittance inflow into Nigeria and other countries in the Sub-Saharan Africa region in 2022, the World Bank, stated: “Remittance inflows to Sub-Saharan Africa soared 14.1 percent to $49 billion in 2021 following an 8.1 percent decline in the prior year.

“Growth in remittances was supported by strong economic activity in Europe and the United States.

“Recorded inflows to Nigeria, the largest recipient country in the region, gained 11.2 percent, in part due to policies intended to channel inflows through the banking system.

“In 2022, remittance inflows are projected to grow by 7.1 percent driven by continued shift to the use of official channels in Nigeria and higher food prices – migrants will likely send more money to home countries that are now suffering extraordinary increases in prices of staples.”