CBN Orders Electronic Payments for Travel Allowance Effective Immediately

CBN orders electronic payments for travel allowance effective immediately and in the process bans cash payments. And as per the new directive, all payments that are inclusive of debit and credit cards must all be processed electronically.

CBN Orders Electronic Payments for Travel Allowance

The apex bank furthermore issued a circular dubbed “Allowable Channels for Payout of Personal Travel Allowance (PTA) And Business Travel Allowance (BTA)” warning that authorized all banks not to pay out the BTA and PTA in dollar cash.

CBN Orders Electronic Payments for Travel Allowance

As per the circular signed by Dr. Hassan Mahmud, Director of the CBN’s Trade and Exchange Department, the introduction of this new policy aims to enhance transparency and stability within the foreign exchange market while deterring fraudulent practices.

The updated policy strongly advocates for the utilization of electronic channels for both Personal Travel Allowance (PTA) and Business Travel Allowance (BTA), underlining a continual transition in foreign transactions. This directive aligns with the CBN’s dedication to bolstering the Naira and closely monitoring foreign exchange market dynamics.

Consequently, all authorized dealers and the general public must take cognizance of this policy adjustment and adhere to it accordingly.

Contents of the Circular Issued By the CBN

The CBN reaffirms its new directive, explicitly stating that “Cash payment of PTA/BTA is no longer permissible” to avoid any ambiguity or misunderstanding.

The circular in question revealed that “Memorandum 8 of the Foreign Exchange Manual and the circular with reference FMD/DIR/CIR/GEN/08/003 dated February 20, 2017, stipulate the eligibility criteria for accessing Personal and Business Travel Allowances (PTA/BTA).”

According to the circular signed by Dr. Hassan Mahmud, Director of the CBN’s Trade and Exchange Department, the newly introduced policy aims to foster transparency and stability within the foreign exchange market while discouraging fraudulent activities.

What the Newly Updated Policy Means For Everyone Concerned

The updated policy strongly advocates for the adoption of electronic channels for both Personal Travel Allowance (PTA) and Business Travel Allowance (BTA), emphasizing a continuous shift towards electronic transactions in foreign dealings. This directive is in line with the CBN’s commitment to strengthening the Naira and closely monitoring foreign exchange market dynamics.

Therefore, it is crucial for all authorized dealers and the general public to acknowledge this policy adjustment and adhere to it accordingly.

The CBN reiterates its new directive, explicitly stating that “Cash payment of PTA/BTA is no longer permitted” to prevent any ambiguity or misunderstanding.

The Central Bank’s Instruction on the Removal of the Initial Cap on Exchange Rates

In addition to this, the central bank had previously instructed the removal of the initial cap on exchange rates quoted by International Money Transfer Operators (IMTOs), allowing for market-based limits. Furthermore, the CBN has placed restrictions on inbound transfers, mandating IMTOs and banks to pay out inbound foreign currencies only in Naira.

MORE RELATED POSTS

LEAVE A REPLY

Please enter your comment!
Please enter your name here