CBN introduces new guidelines for foreign currency deposits

The Central Bank of Nigeria (CBN) has issued fresh directives for Deposit Money Banks (DMBs) regarding the deposit of foreign currency notes.

This move aims to deepen the foreign exchange market, enhance liquidity, and align the exchange rates of the parallel and official markets.

According to a circular issued by the Director of Currency Operations, Mohammed Solaja, and posted on the CBN’s website, each bank can deposit a maximum of $10 million in USD 100 and USD 50 notes daily.

These deposits can only be made at the CBN branches in Abuja and Lagos.

“In order to deepen the foreign exchange market, boost liquidity, and attain convergence in the exchange rates of the parallel and official markets, the Central Bank of Nigeria (CBN) has approved that DMBs may deposit their excess foreign currency notes with Lagos and Abuja branches of the bank,” the circular stated.

The circular, referenced COD/DIR/INT/CIR/001/016, highlights that DMBs must notify the CBN in writing at least three working days before making such deposits.

Additionally, smaller denominations of $20 notes and below are capped at a maximum of $1 million daily.

This directive responds to the increasing demand from DMBs to deposit their forex cash with the CBN for onward credit to their offshore accounts with correspondent banks.

The new guidelines are part of broader efforts to stabilize Nigeria’s foreign exchange environment and support economic growth.