WorldRemit calls for urgent restoration of money transfers to Nigeria     

WorldRemit, a leading online remittance provider, on Tuesday called for the urgent restoration of money transfers to Nigeria, saying “draconian new rules” have now left virtually all money transfer operators (MTOs) unable to provide services to the West African country.

The company, which makes more than 40,000 money transfers to Nigeria every month, also announced the immediate suspension of its services, claiming it had been instructed by its local correspondents that money transfers to Nigeria will no longer be processed.
WorldRemit has also raised concerns about a 2015 memorandum from the CBN setting out minimum requirements for companies offering international Mobile Money transfer services to Nigeria.

The guidelines specify that any company offering Mobile Money transfers must have minimum net assets of $1bn and must have been operating for more than 10 years.

Nigeria receives more than $20bn in remittances annually from migrants around the world.

 However, “only three companies, Western Union, MoneyGram and Ria, will be able to continue operations, following an extreme and unexpected move by the Central Bank of Nigeria,” WorldRemit said in a statement.
According to Ismail Ahmed, the founder and CEO of WorldRemit, “this move is arbitrary, inexplicable and hugely detrimental to the Nigerian diaspora who rely on hundreds of money transfer companies and banks, providing them with choice, convenience and competitive pricing.

“Even now, as we suspend our service, there is no clarity on why this sudden change has happened. If it is on the basis of new rules, there was no warning. If it is a re-interpretation of old rules, local correspondent networks and banks should have been forewarned.”

Ahmed argued that the latest policy of the government will reverse the progress made by the country when the Central Bank of Nigeria (CBN) banned Western Union’s exclusivity agreements that had created a near-monopolistic position in the international money transfer market.
Western Union had controlled 78 percent of the market share before the CBN outlawed its exclusivity agreements with local banks.

Until now, money transfer operators such as WorldRemit operated via partnerships with licensed local correspondents in Nigeria, enabling transfer of funds to local bank accounts.
“It looks like all systems in Nigeria are currently geared against encouraging new entrants and competition in the mobile remittance markets. That is worrying in the extreme,” Ahmed lamented.