A bill seeking to ban the use of foreign currencies for payments and transactions in Nigeria has passed its first reading in the Senate.
The proposed legislation is aimed at ensuring all payments including salaries and other transactions are carried out using the local currency, Naira.
The bill, titled “A Bill for an Act to Alter the Central Bank of Nigeria Act, 2007, No. 7, to Prohibit the Use of Foreign Currencies for Remuneration and for Other Related Matters,” is sponsored by Senator Ned Munir Nwoko, Chairman of the Senate Committee on Reparations and Repatriation.
According to Senator Nwoko, the widespread use of foreign currencies in the country’s financial system undermines the value of the Naira, which he said, perpetuates economic challenges.
Nwoko described the use of the Dollar, Pound Sterling, and other foreign currencies for transactions in Nigeria as a colonial relic that continues to sabotage Nigeria’s economic independence.
He clarified that transitioning domiciliary account balances to Naira would be a voluntary process for account holders. As the Naira strengthens, the need to hold foreign currencies would diminish, making the transition seamless.
The lawmaker also assured Nigerians that access to foreign exchange for travel and other legitimate purposes would be streamlined through banking reforms, alleviating concerns about access to Basic Travel Allowance (BTA) and other forex needs.
However, drawing parallels with Morocco, Senator Nwoko noted the stability of the Moroccan Dirham, which has maintained consistent value against major currencies for over 35 years.
He attributed this to Morocco’s policy of exclusively using its local currency for domestic transactions.