CBN Scraps Cash Pooling for IOCs, Grants Full Access to Export Proceeds

The Central Bank of Nigeria (CBN) has removed the cash pooling requirement imposed on International Oil Companies (IOCs), granting them full and immediate access to their repatriated export proceeds in a move aimed at boosting liquidity and efficiency in the foreign exchange market.

In a circular issued by the apex bank and signed by the Director of Trade and Exchange Department, Musa Nakorji, the CBN said the decision was part of ongoing reforms to liberalise the forex market and align with prevailing market realities.

This is a shift from the guidelines introduced in 2024, which mandated Authorised Dealer Banks (ADBs) to pool 50 per cent of export proceeds on behalf of IOCs, while the remaining 50 per cent was held for 90 days before repatriation.

The circular stated, “As part of the reforms aimed at creating more liquidity and stability in the Nigerian Foreign Exchange Market, the Bank issued two circulars in 2024, allowing Authorised Dealer Banks (ADBs) to cash pool 50 per cent of repatriated export proceeds on behalf of International Oil Companies (IOCs) with the remaining 50 per cent retained for 90 days before repatriation.”

It, however, noted that the apex bank has now reviewed the policy framework to further deepen the market. “To further liberalize and deepen the market in line with current market realities, IOCs are hereby granted unfettered access to their repatriated export proceeds.

“The IOCs may repatriate 100 per cent of their export proceeds through the ADBs, who shall ensure adequate documentation and submit a monthly report to the Director, Trade & Exchange Department,” the circular added.

The CBN emphasised that the new directive supersedes all previous circulars on cash pooling and takes immediate effect.

“Please note that this provision supersedes all other circulars issued by the Bank on Cash Pooling. All Authorised Dealer Banks are to note and be guided accordingly, as this directive takes immediate effect,” it stated.