By Adedapo Adesanya
The Association of the Bureau De Change Operators (ABCON) has called on the Central Bank of Nigeria (CBN) to open up the remittances market to allow more players into the exclusive club.
The group, in its Quarterly Economic Review report for the second quarter of the year, said doing this will increase access points, drive down the cost of remittances service for customers, and also drive the country’s financial inclusion goals.
The association noted that, “Opening up the remittance market generates competition among remittance payment operators.
“This is an important factor for the development of the market because it helps to keep the costs of these services low for consumers, helps increase access points, promote product innovation, and can ultimately contribute to greater financial inclusion.
“Lack of necessary inclusion makes a good volume of the flow into Nigeria’s system to go into the unofficial market sector.”
While noting that the entrance of BDCs to the remittances market is imminent, ABCON challenged BDC operators to train and equip their outfits so that they can render competitive and effective remittance services.
ABCON also called on the apex bank to look beyond the portfolio inflows, which adds to the country’s public debt and instead explore better and less stressful avenues for foreign exchange.
“The CBN should look beyond the portfolio inflows, which adds to the public debt and seek stable and germane sources of foreign exchange.
“The present unification of the exchange rate should also be supported by new techniques and redefined trade policies particularly to mismatch import duties where duties on raw materials are sometimes higher than imported finished goods,” it said.
Lauding the recent decision to suspend the proposed hike in electricity tariff, ABCON urged that the same decision should be extended to proposed increases in taxation and tariffs, stressing that shortfalls in the budget as a result of the suspension should be covered with COVID-19 related donations.
“Most importantly, government should, as a major policy during, this COVID-19 recovery period suspend any imposition or increase in taxation instead such shortfalls that might have emerged between national budget adjustments and expenditures should be covered by various financial support to COVID-19 from foreign and local contributors.
“In line with this observation, all current increases in tariffs and taxes could be deferred until when the economy recovers from the effects of the pandemic.”
ABCON also called for actions to minimize disruptions in the food chain, noting that this was a time to look at an impending food crisis, adding that saving lives should be the key priority now.
“The lockdown and the consequent effects have been in Nigeria for about four months now in various states of the federation.
“One of the evident consequences of COVID-19 crisis is the potential to trigger a food security crisis in Nigeria, with agricultural production potentially contracting between 2.6 per cent in an optimistic scenario and up to seven per cent if there are trade blockages according to a World Bank survey.
“Thus, there should be more emphasis on saving lives and protecting livelihoods through strengthening health systems and taking quick actions to minimize disruptions in food supply chains.
“There should also be a faster implementation of social protection programs, including cash transfers, food distribution and fee waivers, to support citizens, especially those working in the informal sector,” the association stated.
