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CBN removes limit on PAPSS for trade payment services

Why we should protect the independence of the Central Bank

The Central Bank of Nigeria (CBN) has removed limits placed on trade and payment services transactions on the Pan African Payment and Settlement System (PAPSS).

PAPSS is a cross-border, financial market infrastructure enabling payment transactions across Africa.

Read also: CBN limits transactions on PAPSS by dealer banks to $200,000

The CBN disclosed this in a circular signed by Hassan Mahmud, director, trade and exchange department.

This followed the recent liberalzation of the Nigerian Foreign Exchange Market and the CBN initiatives to boost foreign exchange inflows, particularly through the facilitation of intra-Africa continental trade.

In July 2023, the apex bank pegged the amount of dollars to be transacted on the PAPSS at $200,000 per quarter by authorised dealer bank (ADB) and $20,000 per quarter for a customer.

“We hereby revise our Circular – RefTEO/FEM/PUB/FPC/011005 issued on July 25, 2023, on the above subject, as follows: removal of ail restrictions and limits on Pan African Payment and Settlement System including US$20,000 and US$200,000 quarterly limits per Individuals and Authorised Dealer Banks (ADBs), respectively, removal of the restrictions of ‘ONLY’ trade backed and inwards transactions.

ADBs are allowed to source for FX for settlement of PAPSS transactions through the Nigerian Foreign Exchange Market -with no recourse to the CBN

All export proceeds repatriation under PASS shall be subject to certification by the respective processing banks, and all documentation requirements stipulated in the CBN foreign exchange manual and extant circulars shall continue to apply.