Category: Special Report

Lagos State Governor Babajide Sanwo-Olu yesterday explained the issues that led to a three-day strike by the Lagos chapter of the Medical Guild. Excerpts:

All health workers’ allowances approved, paid

We are in Infectious Disease Hospital (IDH) in Yaba and you journalists have asked me question around the ongoing warning strike by doctors and health workers. One of the first things we need to understand is the responsibility of the government to cater for the welfare of all workers. I have met with health workers in this Infectious Disease Hospital and I asked about their wellbeing; they said they were doing fine. I have the overall responsibility to ensure that all the state’s workforce, be it in the public or private sector, are doing well.

I also have the responsibility to ensure lives of all residents and their property are secured. This is paramount to us. The media would agree with me that in the last 412 days we have come on board, security and welfare of the people have been part of our guiding principles. And we will keep doing that as we go along.

However, disputes are also natural in human relationship. People might see things differently from the way others do see it. Personally, I am not upset about the warning strike embarked on by the Medical Guild. The action is not anything to grieve about; it is really all around communication and understanding. You will understand things when you see knowledge, and wisdom will also come in when you seek knowledge. These are key guiding principles. The issues of disagreement are very simple; it is because of lack of adequate communication.

The first thing they said is that, we owe some workers hazard allowances. For the benefit of the public, our government is the first, in March, that started paying hazard allowance to our entire health workers, almost 20,000 of them. We increased the hazard allowance by 400 per cent and this is verifiable. Lagos is the first to do this. All the entire health workers – doctors, nurses, drivers, and hygienists – got a 400 per cent on hazard allowance as enumerated in their payment structure.

Above that, we realised we needed to give additional incentive to frontline workers specifically engaged in the fight against COVID-19 pandemic. This is called COVID-19 allowance, which is outside their regular salaries and hazard allowances. The COVID-19 allowance is for over 1,000 medical officers and other auxiliary workers in all of our isolation centres. On this additional allowance, I do not need to consult with anybody. It is something I felt it was needed.

Lagos is the first in the country to create this additional allowance and we are doing it not because we wanted to show off. We realised Lagos is the epicentre of the COVID-19 pandemic and I think we should show leadership and commitment to all our frontline staff. So, we created that allowance and paid it.

So, as we go along, we needed to review our strategy, because our strategy at that time when we created the COVID-19 allowance was to contain the pandemic before it would get to the communities. So, we paid the allowance, which, in my view and everyone’s view, was roof-top. We actually paid people allowances that were like twice of their monthly salaries. We had thought COVID-19 is a pandemic we would resolve within one or two months. So, we created the allowance as motivation for everyone on the frontline.

However, all of us have seen that this pandemic has grown from being a street run to a marathon. So, we needed to have a change in strategy. Part of the strategies is to keep all allowances to what we will feel comfortable to pay. Just last month, we paid allowances. However, we feel we need to do proper enumeration on the COVID-19 allowance.  We needed to ensure that people that will get the COVID-19 allowance are people that have worked during the period of COVID-19 and those that have worked in one or all of our isolation centres.

So, we had a two-month delay, meaning that we have paid two months, but we have not paid May and June. The only reason for this is that, we want to be sure the right people get paid this COVID-19 allowance. As I speak, most have them have gotten the allowance for two months arrears. The amount the government pays as COVID-19 allowance is at my discretion and it is even still more than what the Federal Government pays. But this is not a competition.

Disagreement on tax issues

The other concern of the health workers is taxes. Tax is a component of the law of the federation. However, I have been hearing about excess tax since I was Commissioner for Establishment. Medical workers have been complaining that they are taxed more than necessary. At that time, the Lagos Inland Revenue Service (LIRS) chairman solved those problems. The salaries of medical workers have since been improved since that time. Maybe the issue now is that they still feel their salary is small.

Taxation and salary deduction is a function of the law and there are things that are allowable and things not allowable. Even at that, we said let’s further look at the salary and asked about the amount of tax can the Government place on the salary of a medical officer. At best, maybe it is N5,000, N7,000 or N8,000 they are talking about. But we agreed that we will meet with the chairman of LIRS and sit with him to look at what we can do. I cannot take unilateral decision on tax. It is the Federal Government’s law. The review cannot be at the whims and caprices of myself or anybody; any action to be taken on that must follow the law. And the independent body called LIRS has the responsibility to look at the issue and give us what is applicable and what is not applicable.

Doctors’ Residential Quarters

With all the best intention, we have two developers we have commissioned to build accommodation for health workers. Even if we start today, the minimum period we can deliver such project is 24 months. To build an accommodation is not something you can just tell me do within a short period. In this premises we are now (IDH), there is a plan to develop Doctors’ Quarters. There is an international company that has said they want to work with us to build a hospital. I told them what we urgently need is Doctors’ Accommodation.

As I speak to you, the design of the project is coming up. Same thing is happening in Lagos State University Teaching Hospital (LASUTH); we have a private sector firm we are already talking to. We have agreed to build Doctors’ Quarters for the health workers, but it is not something that will happen in a day. Space has to be aligned, designs have to be done and funds have to be available. So, we said within 24 months, we will see what can be done.

There are other challenges, which I have to explain. What will happen if I give a quarter to someone working with the State Government and two years after, the person leaves and goes to another hospital not owned by the Government; the problem is they will not want to leave the quarter. But, this is a conversation for another day. The quarters will come; it is government’s asset and we will create the asset for them.

On shortage of medical personnel

We have a standing order on replacement on exit of any health worker. The Health Service Commission does not even need my permission to do that. It has been our standing rule only for the health workers and teachers to replace upon retirement. Because of the current pandemic, there have been, in the last six months, about 600 to 700 general health workers – doctors, nurses, hygienists – that have had to retire due to statutory retirement age. We have since given approval for replacement. COVID-19 has kept all of us at home for the past three months. Over 65 per cent of civil servants in Alausa are still at home. I have given approval to recruit 760 health workers, of which 400 are doctors alone. Even the capacity to be able to identify the 400 doctors alone is a challenge. But, the process has started; the Medical Guild is aware of this. They have been carried along in the process.

Unceremonious dismissal of workers from COVID-19 work

This allegation is rather unfortunate. Sixty-five per cent of all of our health workers are working in our General Hospitals. What we have seen after we changed our strategy in the response to COVID-19 pandemic is that, we realised people are getting tired. A lot of health workers have had to work back-to-back in this period and fatigue was setting in. We said we needed to make a change and asked the fatigued workers to go back to their primary roles maybe in General Hospitals or Primary Health Centres (PHCs). We wanted to bring fresh hands in to come and help out because we don’t know for how long the pandemic will be around.

When they started, we said initially that we just wanted to put a small team of health workers together to fight COVID-19 and put it to and end; but, the pandemic has not gone. So, we felt we needed to re-tool the medical workers and re-energise them and take the ones that have worked in the isolation centres for three to four months back to their regular roles they were employed for. We agreed we will continue to pay their hazard allowances, but we needed fresh people to also come and work. Maybe the challenge was that, we had not paid the COVID-19 allowance of those asked to return to their regular roles. We have since paid the allowance. This talks about communication gap, because we never sacked any health worker. This is a case of “go back to your work” in the General Hospital or PHCs and let fresh hands come in to continue to do the work.

Special care for frontline health workers

We have a dedicated isolation centre specifically for health workers at Agidingbi. Any health worker that falls sick or test positive for COVID-19 is to be taken to the dedicated isolation centre. It has been there for over two months. We care for them there. They quarantine themselves there; they don’t need to go their homes to infect their loved ones. Over the last four months, we have had 14 hotels in which all our health workers have been staying. These hotels are located in Lekki, Ikoyi, Ikeja, Jibowu and other places. We have been paying and feeding them in these places. This is to ensure that our health workers are comfortable and dedicated. Recently, we have also dedicated a day every week for any health worker who wants to be tested. We are doing all the testing for them free of charge.

Disparity of wage paid by Lagos and Federal Govt

How can Lagos, with its lean revenue, be comparing itself with the Federal Government? For information sake, our minimum wage is higher than what the Federal Government pays. This means, across the public service, we pay more than the Federal Government. I don’t need to go into issues around who does what. We know what they requirements are. We know this is Lagos and the cost of living is higher than a few other states.

For us, we are actually doing more for our workers. So, we asked the doctors to show us evidence of pay disparity. They pointed to salary of Level 14. They later said it is entry level. How can we be joggling figures from one level to the other? If you have issues, let us look at it entirely and solve. You cannot say that one is higher in pay in Level 9 and lower in Level 14 or Level 13. That is not the solution. I am not upset and there is absolutely nothing for me to be upset about. Everybody can testify that health workers are people I have tremendous respect for and they are doing a fantastic job.

We will always have issues around misinformation or lack of information. Or maybe the Commissioner for Health is not always available any time they (Medical Guild) want to meet with him. But the man has a difficult job to do around this pandemic. So, it is rather unfortunate that my workers who I love so dearly would take this very unexpected action to vent their grievance. Grievance is natural in any dispute but discussion must start and end on the table. It is surprising that the striking doctors want to take an opportunistic approach in time of pandemic in solving issues. It is totally condemnable. As the Chief Incident Commander, I ask the doctors to come back to work; whatever the issues are, we will sort it out. I believe I am supposed to be the father to all workers, and there is no better engagement we can have except we have it on the table. Just two days ago, I met with the striking doctors’ leadership in my house.

COVID-19 Additional Allowance for engaged health workers

We run an extremely transparent government. The allowance the striking doctors are talking about is the COVID-19 Additional Allowance which I created at my own discretion. When we started, we were paying these workers two, three times of their regular salary and we felt this is not sustainable. I gave the Permanent Secretaries in our health sector a task to do a proper assessment of who should qualify.

There are 14 pillars in the EOC and we had to go round on all of the 14 pillars. We are talking about over a thousand people in different parts of the State, who are not regular staff in the Health Ministry. We needed to be sure and part of things that we wanted to generate is the real name, the real account number and bank account. This is because the allowance is outside of their salary and some of them are not on the payroll of the Government. So we needed to get that analysis right. So, it took them time to reveal all of that.

On why the allowance was paid on the day the doctors declared strike? I gave the approval since last week but NIPS could not effect the payment before the weekend as a result of a glitch in the system. That was what happened. When the doctors came to my house, I called the Accountant General in their presence and put the phone on speaker. It was exactly what I explained to them was what the Accountant General said. So, what better transparency do they want? Lagos is the only State that has given the health workers on COVID-19 frontline an additional insurance cover outside of what they regularly have. In the event of fatality or injury, the amounts are there. I don’t need to mention the figure. We gave additional insurance certificates to each person engaged in the COVID-19 response.

Shola O’Neil, Port Harcourt and Elo Edremoda, Warri

THE $2.8 billion Ajaokuta-Kaduna-Kano (AKK) Gas Pipeline project kick-started virtually on July 1 by President Muhammadu Buhari is under threat.

The Ijaw and Itsekiri ethnic groups in Warri, Delta State, on Sunday threatened to sabotage the project if work is not resumed on the $16billion Gas Revolution Integrated Project( GRIP)) in Ogidigben.

The two major ethnic groups in Delta State, whose militants in the past crippled oil and gas production in the region, are also kicking against Federal Government’s failure to include them in the bid process for 57 marginal oil fields in their area.

Apart from the GRIP and the inclusion of their kinsmen in the sale of the marginal oil fields, they want the restart of work on the Deep Sea Port in Okerenkoko, the Omadino-Escravos road project and the Floating Dock/Ship Building Yard, Okerenkoko.

In a joint communiqué by the Gbaramatu Traditional Council of Chiefs and the Movement For Itsekiri Oil/Gas Producing Communities (MDIOGPC), the communities warned that the seeming delay in carrying out their threat to shut down oil and gas operations, after the expiration of their 10-day ultimatum, should not be mistaken for “weakness.”

In the communiqué which was read by the Olorogun of Warri Kingdom, Chief Mike Odeli, they accused the Federal Government of being “adamant” in responding to their demands.”

The Ijaw and Itsekiri lamented alleged marginalisation by the government through the Ministry of Petroleum Resources, the Nigeria National Petroleum Corporation, the National Petroleum Investment Management Services (NAPIMS) and the Department of Petroleum Resources (DPR).

They noted that “the continuous neglect” of Gbaramatu indigenes and the Itsekiri by the government in investment opportunities in the petroleum industry, will “aggravate crude oil theft and pipeline vandalism”.

The spokesman for Gbaramatu Kingdom, Chief Godspower Gbenekama, said: “We have respected our leaders and the state government. We have exercised patience for some days. We will go ahead with the shutdown.

“If we have projects that cannot come on board, then every other project should not come on board. If there is no GRIP, then that is no AKK gas project. NPA (Nigerian Ports Authority) must start dredging the entrance of the Escravos River.

“It’s been over 20years since Itsekiri and Ijaw communities came together to fight a cause. We have resolved to push our threats through. We will ensure that no oil, no gas flows from our land.”

Others who spoke arehief Vero Tanbowei; Alex Eyengho, Shadrack Onicha Henry Atete, Paul Bebenimibo and Agbateyiniro Isaac.

Smallholder farmers in Nigeria, majority of who are women, produce the bulk of the food that the nation feeds on. The COVID-19 pandemic has had a devastating effect on their business just as its effects are felt in other sectors of the economy. Some smallholder women farmers in Niger State recount the harrowing experiences they face because of the impact of the pandemic. JUSTINA ASISHANA, with support from the International Budget Partnership (IBP), reports

“THIS year, I am experiencing hard times. I do not have any sprayer to use on the farm, all my sprayers have spoilt. I also do not have fertiliser or any chemical to spray on my farm. I am experiencing these challenges because there is no money to buy these things,” Dorothy Uchenna, a smallholder farmer in Niger State, told The Nation.

Dorothy is not alone in this ugly situation. Every other smallholder farmer in Niger State is facing it. They have been unable to sell their farm produce because of the ban on inter-state movement. Currently, hundreds of bags of farm produce are waiting to be off-bundled in the state because the restriction of movement has led to the unavailability of buyers for these products.

As part of Nigeria’s effort to curb the spread of COVID-19 in the country, President Muhammadu Buhari enacted the COVID-19 Regulation 2020, which, among other measures, imposed significant restrictions on the movement of people and goods in Lagos and Ogun states as well as the Federal Capital Territory (FCT). Other states across the country also restricted movements into their respective territories from neighbouring states. The move made it impossible for traders to travel to other states to buy goods and render services.

Smallholder women farmers are the worse hit by this as the majority of them are currently finding it difficult to begin this year’s cultivation of yam, soya beans, maize, rice and melon; despite the exemption of vehicles conveying food and other essential materials from the restriction. Customers of these farmers are finding it difficult to beat the inter-state ban to travel to other states.

Data got from the National Bureau of Statistics (NBS) Food Prices Watch revealed that there is a reduction in food prices, especially in yam while maize and rice showed a little rise in price. The price of some food not captured by the NBS has also gone up.

According to NBS data, in March last year, local rice was sold for N244 per kilogram and yam was sold for N197. But in March, this year, local rice was sold for N216 and yam was sold N150; last year April, rice was sold for N278 and yam for N194 per kilogram, in April this year, rice was sold for N293 and yam was sold for N124 per kilogram.

While in May last year, rice was sold for 287 and yam for N205 while in May this year, rice was sold for N289 and yam for N161.

In March last year, maize was sold for N83 per kilogram but in March this year, it was at N116; in April last year, maize was N124 but in April this year, maize was N106 while in May last year, maize was sold for N85 and in May this year, maize was sold ar N112 per kilogram.

Despite these prices, the farmers claim they are keeping their goods until the price is favourable and their customers from outside the state are allowed to come in and buy the goods from them at the prices they feel would be reasonable for them to benefit from the labour on the farm.

No farming due to lack of money – Dorothy Uchenna

The modus operandi of Dorothy Uchenna, who has a farm comprising yam, maize, millet and melon in Chachanga Local Government Area of Niger State, is to sell her produce and use part of the money for the new planting season whereby she can get input, pay the labourers she engages and others. But this year is different as she has not been able to sell her crops.

“We are still considering how to go about farming this year. This year, we are not planting much. The produce that we brought into this year that we are supposed to sell out such as melon, which we used to sell for N100,000 a bag is now N50,000. The difference is much and the market is just like that this year. We are managing to sell it out because if we don’t, the new ones that will be harvested this month will affect the sale of the old ones.”

Madam Larry, who is a yam, maize and soya-beans farmer in Paikoro Local Government Area of Niger State. She said most of the prices of products have fallen drastically, which is why she cannot sell her crops at this time as she is not ready to face the loss.

Mariam Musa whose farm is also in Chachanga Local Government Area of Niger State has bags of soya-beans, groundnut and maize, which she cannot sell because of lack of customers and fall in the prices of the crops.

Mariam, who said she has no money to pay labourers this year, makes use of her children in farming. When The Nation visited her farm, three of her children were helping her to plant maize.

“Right now, I have 10 bags each of groundnut, soya-beans and maize and I sell per measure. I have not tried to sell it because I heard people saying all the prices have fallen and there is no market at all.”

‘We are set for loss this period’

The women farmers in Bida axis are not immune to the challenge of selling off their crops as they are faced with the same challenge. Millicent Yisa and her husband in Enagi Local Government Area of Niger State have about 150 bags of beans, melon, guinea corn, soya-beans and rice in storage.

“Today, I had to beg someone to buy the groundnut off my hands so that they will not spoil because they are already infested. This year, we are selling our farm produce at lower prices.,” she said.

An expert in Rural Agricultural Development, Professor Kola Adebayo of the Federal University of Agriculture, Abeokuta, said the reason for the gap in the storage of food and the prices of food products is a signal of the failure of government in taking proactive steps of engaging the farmers, especially after the production of their farm produce.

The Director, Planning, Research and Statistics of the Niger State Ministry of Agriculture and Rural Development, Alhassan Umar, said it is the Federal Government that is responsible for the strategic grain reserves and not the state government, adding that although there is a grain reserve in Niger State, it is, however, under the responsibility of the Federal Government.

He said the state government has a Buffer Stock programme where they buy excess grains from farmers after each farming season and sell to the people at a subsidised rate.

Millicent Yisa and her husband have decided to pull resources and invest heavily in upland rice which they believe would help them cushion the loss they will face on other crops.

 ‘Dipping Egusi prices a nightmare ‘

For Ruth Illiya, maize, guinea corn, Egusi and soya beans farmer in Gurara Local Government Area of Niger State, the falling price of egusi is something farmers in the state have never experienced in the past.

“Imagine egusi that is usually sold for N500 for unpeeled and N1000 for peeled ones per mudu at this time of the year is now being sold at N150 for unpeeled and N400 for peeled ones. The price has fallen probably because people are no longer coming from outside the state to patronise us. We will face serious loss if we sell it now, that is why we are storing the produce,” she said.

Illiya added that although she has some farm produce at home, money is still needed to get additional items and essentials for the home.

‘Our members are suffering’

The effects of the lockdown and restriction of movement on businesses prompted the Federal Government to introduce fiscal and economic stimulus measures to ameliorate the impact on businesses and save the economy from total collapse.

However, being women and mostly the breadwinners for their families, smallholder women farmers are expected to be beneficiaries of both the food that is being distributed to households as palliatives as well as the Conditional Cash Transfer, particularly, the additional one million households ordered by the President to be included in the National Social Register.

But the majority of the smallholder women farmers in Niger State said they did not receive any palliatives either from the state or Federal Governments. Neither did they receive any money from the conditional cash transfer initiated by the Federal Government.

The Niger State Coordinator of the Small Scale Women Farmers’ Organisation of Nigeria (SWOFON), Grace Disa, confirmed that none of her members received any stimulus package.

The SWOFON Coordinator appealed to the Niger State government to also consider women during this farming season.

The majority of the smallholder women  farmers in Niger State are not aware of the farmermoni while they said the conditions to get loans from Bank of Agriculture, NISRAL or Bank of Industry are usually cumbersome.

Capital inflows to the economy through diaspora remittances from Nigerians living abroad stood at $25 billion in 2019. But the World Bank has predicted 20 per cent dip this year as the impact of Coronavirus pandemic on people’s income weighs in. Analysts predict earnings could improve by liberalising channels for diaspora remittances collections and making over 5,000 Central Bank of Nigeria licensed Bureau De Change (BDC) operators agents, writes COLLINS NWEZE

CRUDE oil has for decades been the mainstay of Nigeria’s economy. That is what the majority of Nigerians know. But only a few people are aware that Nigeria earns more dollars from diaspora remittances than it earns from crude oil sales. However, signals from the remittances market are no longer looking fabulous.

World Bank has predicted that the huge dollar inflows from Nigerians living abroad will drop by 20 per cent this year as senders face income crunch due to the Coronavirus pandemic.

The Nigeria National Petroleum Corporation (NNPC) inflow in 2019 was about $15 billion while migrant remittances stood at $25 billion, adding to the country’s Gross Domestic Product (GDP).

However, the World Bank’s prediction means there was a need to attract more remittances in the economy by increasing the channels through which the funds come in.

World Bank Group President David Malpass said remittances are a vital source of income for developing countries. The ongoing economic recession caused by COVID-19 is taking a severe toll on the ability to send money home and makes it all the more vital that we shorten the time to recovery for advanced economies. He explained that remittances help families afford food, healthcare, and basic needs.

Malpass estimates that remittances to low and middle-income countries would recover and rise by 5.6 per cent to $470 billion. He said the global average cost of sending $200 remains high at 6.8 per cent in the first quarter of 2020, only slightly below the previous year. Sub-Saharan Africa continued to have the highest average cost, at about nine per cent, yet intra-regional migrants in Sub-Saharan Africa comprise over two-thirds of all international migration from the region

Analysts said financial sector regulators could amend Bureau De Change (BDC) operators’ operational modalities to include receiving remittances.

Association of Bureaux De Change Operators of Nigeria (ABCON) President Aminu Gwadabe said diaspora remittances remain the backbone of Nigeria’s foreign exchange inflows and should be protected. He said protecting the remittances market will require policy shift including breaking the current monopoly that limits funds receipts to only ‘few lucky’ players at the detriment of the economy.

For him, now is the time to break the monopoly, which puts the remittances market in the hands of few players and deprives others from tapping into the goldmine. For him, there is an urgent need to get more players to join the remittance collection market including getting BDC operators approved for the business.

He said Bureaux De Change (BDCs) one of the channels through which Diaspora remittances enter the economy will give depth to the forex market and boost BDCs operations.

He insisted that for Nigeria to get the full value of what is due to her in the remittance market, BDCs have to be included in the remittances payment channels and allowed to receive funds from Nigerians in Diaspora. The BDCs are to perform this role through contactless and digitised channels to make collections easy and seamless.

“Now is the time for government and financial sector regulators to promote contactless payment channels, leveraging digitisation in the receipt of migrant remittances. The first win will be getting BDCs included in the payment channels to break monopolies of the fewer players, use of Simple Virtual Know Your Customer rule for beneficiaries and implementing supportive regulations,” Gwadabe said.

The ABCON boss also called for the establishment of training institutes to enhance capacity and infrastructure in the industry and broadening players’ business scope with cash-back incentives for those that patronize BDCs while also implementing less cumbersome and complex documentation requirements for end-users.

Gwadabe said the entry of BDCs into the remittance market will reduce such high cost of receiving money and deepen the job market.

Besides, 90 per cent of the total World Bank estimate of about $18 billion is trading outside the official window while a majority of the registered International Money Transfer Operators (IMTOs) patronise the informal market because of the higher margin and post-funding settlements method of the unlicensed agents.

Opportunities in Diaspora remittances

According to Gwadabe, there are over 1.24 million Nigerian Migrants abroad and 50 per cent of them live within the African neighbourhood, and the figure is expected to rise in the coming years.

The migrants’ cumulative remittances figures into the economy by the World Bank estimates indicated $22 billion in 2017, $23 billion in 2018 and $25 billion in 2019.

However, there is a huge differential between the Word Bank statistics and the local sources due to lack of data and operators indulgence in non-reporting and non-rendition practices to the official window.

Gwadabe listed the importance of migrant remittances to the economy to include serving as a lifeline for the recipient’s small household in the economy and used for health, nutrition, education and societal needs.

The remittances are also higher than both Foreign Direct Investment and foreign aids flow to the economy and still, are cheaper sources of funds.

He said that remittances can be used infrastructural developments as seen in India and Lebanon while in the UAE, the remittances are stable sources of liquidity in the market. The remittances, he added, can also serve as an excellent source of investment funds in the economy even as it represents 83 per cent of the Federal Government budget in 2018.

The remittances were 11 times higher than the FDIs in the same period and 7.4 per cent larger than 2017’s $3. 34 billion, the net official development assistance.

Still, some factors have been listed as responsible for the drop in migrants’ remittances to Nigeria. Gwadabe said, they include, limited payers in the cash out-cash, cash-in the industry, lack of capacity and infrastructures to receive the funds, uncompetitive forex rates, as well as competing fixed and parallel market rates. There have also been inhibitive regulatory policies, over-reliance in cash and complex distribution and handling nature of cash, activities of unlicensed operators and manual Know Your Customer (KYC) plans.

CBN’s Policy Direction

The CBN has, for years, implemented robust and friendly policies to deepen the players in the market and remains the first regulator in the world to ban exclusive contracts of the dominant players.

The CBN Management led by Godwin Emefiele remains proactive and is taking steps that promote more Diaspora remittances inflow into the economy.

Such move, he said, will address the dwindling outlook of the naira in the post-COVID-19 era and help in achieving the vision of making the local currency sovereign in the West African Market.

Also, the CBN forex policy has brought stability to the BDC industry and helped operators to embrace automation which is the standard best practice globally and adding the BDCs to one of the channels through which the Diaspora remittance funds come into the country will be a good way to reduce the reliance of rate differentials to sustain operators’ businesses.

BDCs are expected to continually support Nigeria’s growth agenda and CBN’s commitment to exchange rate stability. To continue to play these roles creditably, the BDC industry needs improved access to foreign exchange.

Emefiele has brought stability to the BDC industry and helped operators to embrace automation which is the standard best practice globally and adding the BDCs to one of the channels through which the Diaspora remittance funds come into the country will be a good way to reduce the reliance of rate differentials to sustain operators’ businesses.

Analysts said Nigerian BDCs, like their counterparts in other emerging or developing economies, have what it takes to deepen the forex market through remittances and collections.

“When that happens, it will not be the first time that BDCs were allowed to turn the remittances market around for good. In India, the BDCs generate over $30 billion from the Diaspora remittances. In the United Arab Emirates, the entire banking needs of banks are met by the BDCs. The working of the Lebanon economy is highly dependent on the activities of BDCs in that country. Therefore, Nigeria can also achieve higher revenue through BDCs given the opportunities we seen in the remittances market,” they said.

Besides, financial institutions’ long procedures, complicated forms, and history of poor service quality mean BDCs entry into the market will change the dynamic for good because they are not only simple in their operations but are closer to the people needing the remittance funds.