Apr 8, 2015

CBN BANS FOREIGN MONEY FOR BUSINESS



Credits -onlinenigeria.com

 “The CBN raised concerns over the increasing use of foreign currency as a medium of exchange in Nigeria and warned that persons caught in the illegal act risk a six month jail term upon conviction.”
 - Punch Newspaper, 8th April, 2015.

A couple of weeks ago, a friend of mine mentioned that there are a number of schools in Nigeria who insist that the school fees of wards/students should be paid in dollars, there are also several property merchants especially on the Lagos Island who insist that rents should also be paid in dollars. No matter how cool this might sound, it’s an act that has negative consequences for the Nigerian Naira and in extension the Nigerian economy.


This is also the reason why CBN is bursting people  the Central Bank of Nigeria has issued a stern warning to all business operators in Nigeria that the use of the US Dollar as a medium of exchange in Nigeria should be totally stopped and this warning comes at the heels of the rise in exchange rate between Nigerian Naira and the Dollar. By its natural duties, the principal objects of the Central Bank of Nigeria as contained in the CBN Act 2007 is to –

(a) ensure monetary and price stability;
(b) issue legal tender currency in Nigeria;
(c) maintain external reserves to safeguard the international value of the legal tender   currency;
(d)promote a sound financial system in Nigeria; and
(e)Act as  banker and provide economic and financial advice to the Federal Government

Though the directive comes strongly form the CBN due its bid to regulate the current dollar price, it should be noted that by virtue of the 2007 CBN Act, it is actually a crime as the law provides that any person who refuses to accept the Naira as a means of payment is guilty of an offence and liable on conviction to a fine of N50,000 or 6 months imprisonment. What about people that share dollars though?

Adedunmade Onibokun, Esq
@adedunmade/twitter
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