The Central Bank of Nigeria (CBN) has issued a new directive mandating full documentation for all Pan-African Payment and Settlement System transactions involving export proceeds exceeding $2,000.
It said the directive was in furtherance of moves to tighten compliance with foreign exchange regulations and ensure proper clearance of goods.
The CBN said in a circular that under the updated rules, transactions under $2,000 for individuals and $5,000 for corporate entities, the basic Know Your Customer and Anti-Money Laundering documentation already provided to Authorized Dealer Banks will suffice.
“For transactions above USD2,000 and USD5,000 for individual and corporate, respectively, all documentation requirements stipulated in the CBN Foreign Exchange Manual and extant circulars shall apply,” the circular read in part.
It said individuals and corporations dealing in exports beyond the specified amounts will now need to adhere to stricter documentation protocols.
The CBN further stated that applicants shall be responsible for ensuring that regulatory documents are made available, to facilitate the clearance of goods (as may be requested by the relevant Government Agencies), to ensure that all necessary paperwork is in place for the smooth clearance of goods across Nigeria’s borders.
The CBN also permitted Authorised Dealer Banks to source foreign exchange for the settlement of PAPSS transactions directly through the Nigerian Foreign Exchange Market, “without recourse to the CBN”, to enhance the flexibility and efficiency of transactions, reducing reliance on the central bank.
The CBN emphasized that “all export proceeds repatriated under PAPSS shall be subject to certification by the respective processing banks.”
