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The Federal Government has issued a nine-month ultimatum to individuals who are keeping dollars outside the banking system.
The Minister of Finance and Coordinating Minister of the Economy, Wale Edun, while briefing State House correspondents after the National Executive Council (NEC) meeting in Abuja that the government unveiled a new policy for Nigerians to deposit dollar bills held outside the formal banking system without scrutiny.
He said: “There is going to be a release today, details by the federal government through the Ministry of Finance, in conjunction with the Central Bank, a programme, starting today, the 31st of October, and lasting nine months, that will allow people to bring in cash that is outside the banking system.
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“Therefore, it is unsafe, it is unsecured and it is outside of legal limits. They will allow forbearance to bring dollar cash. Let me emphasise once again that it is to bring dollars that they are holding outside the system; to be able to bring them in and credit them to their bank accounts, as long as it is not proceeds of crime or illicit money. There will be no penalty, there will be no taxes, and there will be no questions.
“They just meet the normal Know Your Customer criteria of banks and they have an opportunity to bring in those funds, make them safe, make them secure, and make them available through normal economic activity.
“The details of that, the guidelines of that, will be released; first of all, the announcement by the Ministry of Finance and the guidelines will be followed very quickly by Central Bank.
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“That is an opportunity, not just for people who would normally like to comply, to be compliant with the laws and normal business practice, but of course, it gives us an opportunity to bring those dollars from where they are doing nothing to where they are within the financial system; they add to our reserves, and of course can help with the exchange rate.”
The minister also stated that 25 million Nigerians have benefitted from federal social protection initiatives, including digital outreach, microenterprise loans, and sector-specific support for power, agriculture, manufacturing, health, and compressed natural gas initiatives.
What You Should Know
The Disclosure Scheme, outlined by the “Foreign Currency Disclosure, Deposit, Repatriation, and Investment Scheme Guidelines, 2024,” seeks to encourage Nigerians to voluntarily disclose and formalize their foreign currency holdings, whether domestically or abroad.
According to the Minister, the initiative is supported by the Central Bank of Nigeria (CBN) and the Ministry of Justice and it’s part of the government’s commitment to bolstering economic stability and anti-money laundering (AML) practices.
Key objectives and benefits of the disclosure scheme
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According to Mr. Edun, the Disclosure Scheme is designed to “integrate foreign currency outside the formal financial system into the formal economy” and “strengthen transparency and economic resilience.”
The Minister emphasized the government’s assurance of a “secure, confidential channel” for participants to repatriate and invest their foreign currency, supporting Nigeria’s growth ambitions while adhering to global AML and Countering the Financing of Terrorism (CFT) standards.
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Eligibility and Participation Guidelines
Eligible participants include Nigerians holding legally obtained, internationally tradable foreign currency.
The scheme operates voluntarily, allowing individuals to open or maintain domiciliary accounts with designated Nigerian banks.
Funds disclosed will be managed in a specific sub-account, governed by guidelines issued by the CBN.
Assurances for Participants
The government is extending several incentives to ensure robust participation:
Tax Immunity: Disclosed funds will not be subjected to tax audits or liabilities.
Asset Protection: Disclosed assets will be exempt from expropriation or seizure.
Confidentiality: All disclosed information will be treated with the highest level of confidentiality.
Interest and Repatriation Flexibility: Participants can repatriate their foreign currency at the prevailing exchange rate and will earn tax-free interest on balances in designated accounts.
Participating financial institutions are required to ensure compliance with existing AML/CFT/Counter-Proliferation Financing (CPF) regulations to prevent misuse of the scheme for money laundering or terrorism financing.
Duration and Application Process
The Disclosure Scheme will be open for a period of nine months from its launch date. To participate, eligible individuals need to follow a three-step process:
Deposit the disclosed foreign currency into a designated sub-account.
Open a domiciliary account with a participating financial institution.
Complete an application form provided by the CBN.
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