Few days ago, the Central Bank 🏦 of Nigeria (CBN) announced the suspension of sales of FX to the Bureaux De Change (BDCs) and revealed that they would only be supplying FX to the banks henceforth. In a sequel to that decision, the CBN instructed all deposit banks in Nigeria to set up teller points so as to sell FX to retail customers.The apex bank warned deposit banks against delaying or refusing to offer FX to deserving customers who present all required documents.
In an immediate compliance with this new directive, most Nigerian deposit banks have sent out notifications to their customers informing them of the teller points setup in their various branches for FX sales.
At least I received the said emails from FCMB and GTBank. Below is an excerpt from what Guaranty Trust Bank sent me:
Further to the recent directive by the Central Bank of Nigeria on the sale of foreign exchange to all bank customers, this is to inform you that we have set up dedicated teller points at all our branches nationwide for your eligible foreign exchange needs.
Kindly walk into any of our branches nationwide to buy your Personal Travel Allowance, Business Travel Allowance, pay your international school fees, foreign medical bills, SME Form Q transactions and every other qualifying foreign exchange transaction.
We will treat your foreign exchange requests instantly. This means that you will get your FX the same day in cash and in the case of school fees and medical bills payment, to the stipulated beneficiary offshore. Please note that this is subject to you providing all the required documentation for these transactions."
So Who Can Buy FX From The Banks?
From the above email I got from GTBank, you cannot just walk up to the teller and request Dollar purchase in GTBank or any deposit bank 🏦 in Nigeria right now. If you must go to purchase Dollars from the bank, you will need the required documentation as stipulated by the Central Bank of Nigeria.
For now, FX is only available to students (i.e international students tuition fees), Private and Business Travellers as well as Small Business Enterprises (SMEs)
So What FX Can You Buy From The Bank 🏦 And What Are The Required Documents?
1. The Personal Travel Allowance (PTA) and the Business Travel Allowance (BTA).
2. Forex For Medicals
3. Forex For Tuition Fees and
4. Forex For SMEs.
1. The Personal Travel Allowance (PTA) and The Business Travel Allowance (BTA):
Requirements For PTA and BTA:
* You should at least be 18 years and above, and have a valid Bank Verification Number (BVN)
* It is advisable to have a bank account with the bank you intend to buy the FX from.
* You should of course have a valid Nigerian passport with a valid visa, and valid international return ticket with a travel date not more than 14 days from the date of PTA/BTA purchase.
* PTA request is limited to a maximum of $4,000 per quarter per applicant.
* A return ticket originating from Nigeria, with a minimum travel time of 5 hours to your destination.
* For BTA, you need to make your request with your company letterhead and for BTA for a traveling director or executive. Copy of certificate of incorporation is to be provided as well.
2. Forex For Medicals:
Requirements For Medical Forex:
* You must have a valid Nigerian international passport
* You must be with a valid visa and airticket
* Letter of recommendation from the host hospital
* A letter from a Nigerian government approved hospital (A General Hospital).
* For Medical FX, you need to fill the Form A correctly. (The Form A is the form that is made available to all customers seeking to buy FX to make payments for services offered abroad).
* You also need to have an account with the bank 🏦 you're buying the FX from and have sufficient funds to cover the cost.
3. Forex For Tuition Fees:
This is the type of FX purchase or Dollar buying geared towards funding international education. It is made available for foreign students in most cases. ( Form A is also required here).
Requirements For Tuition Fees Forex:
* Students can apply themselves or through their parents or guardian with a valid BVN.
* Applicants must have an account with the bank from which the request is being made.
* School admission letter and payment invoice from the institution must be provided
* Keep handy the bank details of the foreign institution.
* Your Bank account must be funded to cover Naira equivalent of requested amount.
* Authority to debit. An officially written instruction to the bank to debit your account of the said amount.
* Duly completed Form A application form (To be gotten from the bank 🏦)
* Applying students must possess valid Nigerian International Passport or Foreign passport with Nigeria as place of birth.
A copy of the biodata page of the passport to be submitted for processing of the request.
* Applicant must be in possession of valid visa
* Flight Ticket (This one is optional for new and returning students)
* First degree certificate (For post graduate students)
Forex For SMEs
Form M is a mandatory statutory document to be completed by all importers for importation of goods into Nigeria.
The Form M has a lifespan of 12 months (That is, for general merchandise and raw materials) and 24 months (for plant and machinery), after which an extension of 6 extra months days can be granted on the Form M by the Authorized Dealer Bank 🏦. Any further extension as required must be approved by the Central Bank of Nigeria (CBN).
Requirements For Form M:
Now that we have known the meaning of Form, Let's see what is required to get it so as to assess FX for business purpose.
* You will need to write a formal request letter for it.
* Proforma Invoice, this has to be signed by the exporter.
* A compulsory license from a government related supervisory body. For instance, for electrical materials; a PHCN certificate/approval would be required. SONCAP or NAFDAC Certificate would be required for consumables, the license varies depending on the product.
* Goods to be imported must not be on CBN prohibition list.
* Insurance Certificate to cover 110% of the Free On Board (FOB) value.
* Customer or Dealer Bank 🏦 must log request on Single Window Portal.
* Authorized Dealer Bank to process the Form M and initiate clearance of the Pre-Arrival Assessment Report (PAAR).
Form Q is a unique CBN Forex import source window that allows Small and Medium Enterprises (SMEs) and Retail Businesses to access a maximum of $20,000 dollars per quarter from CBN for importation. It can be obtained from deposit banks and any other FX authorized dealers.
First requirement to get this document is that the SME’s account must have been in operation for at least a period of six (6) months in the bank. The SME must also provide the bank account number of the supplier in the PFI for direct transfer of the FX request.
Other Form Q Requirements Include The Following:
* A Formal application letter which must include; BVN, email address, annual turnover and relevant information on what is to be imported.
* Proforma Invoice containing the details of the supplier, including bank account number.
* The CBN Foreign Exchange Application Form.
* Passport data page of the applicant.
* Letter of request for FX allocation.
Final Thoughts 😊...
In order to buy FX from the bank 🏦 either for PTA or BTA, For Medicals, For School Fees or For SMEs, above are all the details required.
As per the exchange rate, it will vary depending on the bank. But most banks offer around ₦440 to a Dollar for ATM and Online transfers. That is ₦75 lower than what is obtainable at the black market. But if you're buying cash at the bank, the official exchange rate stands at 411.46 as at the time of making this post.
If you cannot go through the hassles because of the documentation, I think you should see the post on how to purchase lower denominations of the USD 🇺🇸 from the black market.