The Central Bank of Nigeria (CBN) has issued a new directive requiring comprehensive documentation for all Pan-African Payment and Settlement System (PAPSS) transactions involving export proceeds surpassing $2,000.
In a circular released on Monday, the apex bank announced that this measure is aimed at strengthening adherence to foreign exchange regulations and ensuring the proper clearance of exported goods.
The circular specifies that “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.” This updated regulation necessitates that individuals and corporate entities involved in exports exceeding these thresholds must now comply with more stringent documentation procedures.
The CBN clarified that for transactions below $2,000 for individuals and $5,000 for corporate entities, the standard Know Your Customer (KYC) and Anti-Money Laundering (AML) documentation already provided to Authorized Dealer Banks will be sufficient.
Furthermore, the CBN emphasized 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).” This provision underscores the exporter’s responsibility in ensuring all necessary paperwork is in order for seamless customs clearance.
In a parallel development aimed at enhancing transaction efficiency, the central bank has authorized Dealer Banks to directly source foreign exchange for the settlement of PAPSS transactions through the Nigerian Foreign Exchange Market, “without recourse to the CBN.” This move is anticipated to increase the flexibility of transactions and reduce dependence on the central bank for foreign exchange settlements related to PAPSS.
CBN Mandates Full Documentation for Export Proceeds Exceeding $2,000 via PAPSS
