Nigeria – the “Giant of Africa” – situated in the Gulf of Guinea in West Africa, is a densely populated country, is termed as a “mixed economy emerging market”. According to the World Bank, Nigeria has already reached the lower middle-income status with abundant natural resource supply, well-developed financial, legal, communications, transport sectors. The Nigerian Stock Exchange, which is the second largest stock exchange in Africa, has contributed a lot to cover this journey and most of the credits go to the agricultural department. As of 2010, 30% of the total population has been employed in the agricultural sector. But there is something that links remittance and the people of Nigeria. People wire money to Nigeria online nowadays through many websites that have reduced the power of banks and MTO’s in money transfer. But despite the development, there have been some problems in the money transfer services of the Nigerian government.
Nigerian government suspends Wire Money to Nigeria Online Services
The Central Bank of Nigeria recently appealed to the localities to beware of the unwholesome activities of some unlicensed International Money Transfer Operators in the country. This advisory became important as there were unregistered and illegal International Money Transfer Operations that came into notice by the government there and had the potential to harm the Nigerian Economy. The Acting Director, Corporate Communications Department, CBN, Isaac Okoroafor, in a statement, asked the Nigerian financial service providers to be duly licensed. He added, “their objective must be to protect the customer and the financial system as well as to ensure the credibility of financial transactions in Nigeria.”
They also added to beware of unregistered IMTO’s. This move by the Nigerian government has become a big problem for the migrants and this has now put the public works, in Nigeria, on a stand-still. But, until the entire matter of unregistered IMTO’s doesn’t settle down, the development work cannot stop. Therefore, what can be done at this point in time is the big question.
Healthy Public and Private Sector Competition
This can aid the need for an overall economic and social development of the country. The Nigerian government has direct control over the social and economic sector. However, their policies affected Nigerian foreign aid. And to overcome this severe blow, CBN relicensed multiple derisked bank accounts. But at the same time, the government has to take the support of the Private Sector. However, this can only be achieved if there is healthy competition between the two major sectors. So, basically, the new government needs to facilitate the competition instead of completely eradicating it. And we are hopeful that they will do it!
Oil production and export is one of the major economic drivers for Nigeria. But most of the Nigerian household items and the basic supplies are not available in Nigeria. Hence, they import them from foreign countries and to make this exchange, they require foreign currencies which is a challenge considering the dropping value of Naira in the international market.
At the same time, various Nigerians saved dollars looking forward to exchanging them when it would hit a higher limit. This is why Nigerian individuals even offered a low exchange rate to the foreigners visiting their country. Apart from the individual stories, the Nigerian government is on the verge of a severe dollar shortage-crisis. In case of a global dollar shortage, it is a high possibility that developing nations and especially countries like Nigeria could take the worst hit!
However, when it comes to exchanging the extra amount back into dollars, it gets difficult for them. Because of this dollar deficiency, exchanging money has been quite difficult.
Along with these, there are some common problems like:
High level of transmission fees
Because of these increased exchange rates, it has been quite difficult for the Exchangers to maintain a constant transmission fee. So most of the banks and MTO’s charge a huge amount for international transaction fee. The transaction fee varies from bank to bank and in MTO’s also. Even when a money exchange offers a transaction fee-free program, the diluted exchange rates make up for the lost money.
The banks and MTO’s have been ruling the world of international currency transaction for many years until the online transaction websites came into existence. These online websites have made transactions easier and predictable. So people can now send money to Nigeria online without paying a hefty price.
One of the major problems occurring continuously in this type of international payment system is the inability of the regulators to track their payment. Online money transfer platforms like FAZRemit ensures that the customers are able to know the exact status of their transaction. At the same time, it gets convenient for the regulators to audit the functioning of the platform.
Prior to this, banks and IMTOs didn’t have this amount of accountability. Although they are evolving too but still, their operational cost seems to take a toll on them now.
Online money transfer industry is by far one of the highest genres of online scams. There are hundreds of online websites who claim to do the transactions instantly. But only some of them are licensed. This is one of the major reasons why customers opt for big names in the industry. However, since the past decade, people have started intense research before opting for any product or services. And this is what FAZRemit recommends!
A proper solution – Wire Money to Nigeria Online
Sending money to Nigeria to your loved ones and making business transactions have become much easier nowadays!
As compared to MTOs and bank transfers, online transactions have paved a new future for the financial sector. With a low transmission fee, faster transactions, secure documentation, and overall accountability, people rely on online money transfers to wire money to Nigeria more than the traditional methods.
Like any other business, online money transfer is also a business. The world bank reported nearly 689 billion US dollars worth remittances in 2017. So, it is important that platforms like FAZRemit take on this responsibility and get ready for the future. Because the baton is changing hands and soon they will be running with it!