CBN Uncovers $2.4bn Invalid FX Claims from $7bn Backlog

February 5, 2024
FX claims

By Adedapo Adesanya

The Governor of the Central Bank of Nigeria (CBN), Mr Olayemi Cardoso, has disclosed that an audit uncovered invalid claims of up to $2.4 billion of $7 billion foreign exchange backlogs in the country.

Mr Cardoso disclosed this during an interview with Arise Television aired on Monday and monitored by Business Post.

He noted that the apex bank would only pay valid transactions which amounted to $4.6 billion, revealing that about $2.3 billion has been settled and the balance should be paid very soon.

“We had Deloitte audit the FX backlogs claims and we discovered that of the $7 billion, $2.4 billion had issues and had no business being there,” he said.

He explained that based on the request documents, it was discovered some of the untenable claims were from entities that did not qualify, adding that some of them were non-existent and wanted to game the system.

“We are not paying [these invalid claims] because there were whole loads of infractions,” he said during the interview.

Mr Cardoso said so far, the apex bank had settled $2.3 billion of the valid $4.6 billion FX backlogs, so that leaves around $2.2 billion left to be cleared to the appropriate sectors.

“What remains is about $2.2 billion claims yet to the cleared,” he stated, revealing that there was an end in sight to the FX backlogs issue, adding that the central bank would clear the balances soon, so it can tackle other pressing issues.

“That will be done shortly. We will clear all that very shortly and we will move on to the next line of action,” the CBN chief assured.

Mr Cardoso reiterated that the Naira remained undervalued due to the speculative nature of the FX market, adding that this would be resolved in due course.

He noted that the CBN was taking the best approach to bring other informal players into the official market to boost liquidity, noting that this spurred recent moves to bring international money transfer operators (IMTOs)into the space.

“We believe it is positive to bring them into the formal market, to be players in the space,” Mr Cardoso submitted, saying that the official market and Bureau du Change (BDCs) rates were narrowing rapidly.

“We are going to see a major major shift. There are new rules that will help the volatility and fix market transparency.”

Adedapo Adesanya

Adedapo Adesanya is a journalist, polymath, and connoisseur of everything art. When he is not writing, he has his nose buried in one of the many books or articles he has bookmarked or simply listening to good music with a bottle of beer or wine. He supports the greatest club in the world, Manchester United F.C.

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