₦airaland Forum

The Central Bank of Nigeria’s (CBN) latest data has revealed a remarkable 63.7% surge in inflows from international money transfer operators (IMTOs) in the first nine months of 2024. IMTO inflows rose to $3.82 billion during the period, a significant leap from the $2.33 billion recorded in 2023.

This dramatic growth is largely credited to key policy reforms implemented under the leadership of Governor Olayemi Cardoso, who assumed office in September 2023.

https://ratecaptain.com/imto-inflows-skyrocket-by-63-7-in-nine-months-following-cbn-reforms/

#IMTOInflows
#CBNReforms
#NigeriaFinance
#ratecaptain

Yeye people dem..

How can our Japa bros and sistas wey send money to their families and friends to alleviate poverty and Hunger in naija cos of Tinubulation translate to economic reforms and growth ?

APC na Troublems

Oladimeji556:
The Central Bank of Nigeria’s (CBN) latest data has revealed a remarkable 63.7% surge in inflows from international money transfer operators (IMTOs) in the first nine months of 2024. IMTO inflows rose to $3.82 billion during the period, a significant leap from the $2.33 billion recorded in 2023.

This dramatic growth is largely credited to key policy reforms implemented under the leadership of Governor Olayemi Cardoso, who assumed office in September 2023.

https://ratecaptain.com/imto-inflows-skyrocket-by-63-7-in-nine-months-following-cbn-reforms/

#IMTOInflows
#CBNReforms
#NigeriaFinance
#ratecaptain

What a shameless attempt at making failure look like progress! The dramatic growth in diasporan remittances isn't the result of any silly policy reform; rather it's due to the dramatic plunge in value of the Naira.

Common sense law of economics - When the Naira value drops, it encourages Nigerians in diaspora to compulsively send more money home. In addition, the heightened hardship in the country is forcing diasporans to send more money back home to support relatives.

How did someone think this was a sensible thing to brandish as an achievement?

obailala:
A shameless attempt at making failure look like progress!

The dramatic growth in diasporan remittances isn't the result of any silly policy reform; rather it's due to the dramatic plunge in value of the Naira. Common sense law of economics - when the Naira value drops, it encourages Nigerians in diaspora to compulsively send more money home.

How did someone think was sensible to brandish this as an achievement?

You don’t have that common sense. The dramatic plunge in naira does not translate to more $$ in IMTO inflows.

—Before CBN reform: If you are sending $100 to Nigeria before, that 70k.

—After the reform: if you’re sending $100, it is now 160k.

So tell me what data point you use to automatically say when the naira value drop, it suddenly make diaspora to compulsively send $$ home to their families.

LegendHero:
You don’t have that common sense. The dramatic plunge in naira does not translate to more $$ in IMTO inflows.

—Before CBN reform: If you are sending $100 to Nigeria before, that 70k.

—After the reform: if you’re sending $100, it is now 160k.

So tell me what data point you use to automatically say when the naira value drop, it suddenly make diaspora to compulsively send $$ home to their families.

With the way things are in Nigeria today, so you genuinely believe it's a special policy of the CBN that's making Nigerians in diaspora send more money home in this period?

There are certain economic events which alter how people behave with their money (economic sentiments). If I used to send $100 back home monthly, the fact that the value has jumped from N70k to N160k activates my 'greed' and motivates/encourages me to send even more than $100 in hope of cashing out nicely. This is common sense economics!

Something similar happens when shops do 'sales' events where they slash prices (Black Fridays); it lures/encourages buyers to spend even more than they'd have normally spent because they want to milk out on the good deals.

In summary, currency depreciation creates an incentive for diasporans to remit more funds back home, just the same way it lures foreign investors to pump more funds into an economy; there's a reason countries like China deliberately devalues their currency from time to time.

obailala:
With the way things are in Nigeria today, so you genuinely believe it's a special policy of the CBN that's making Nigerians in diaspora send more money home in this period?

Yes, it is the special policy. Cardoso mentioned that in April 2024 at the IMF meeting. What they did was reconnect with IMTO and streamline the inflow more easier for them to use the official channel. Before then, it was someone hard. Check the screenshot below.

There are certain economic events which alter how people behave with their money (economic sentiments). If I used to send $100 back home monthly, the fact that the value has jumped from N70k to N160k disproportionately motivates and encourages me to send more than $100 in hope of cashing out nicely. This is common sense economics and this isn't the first time we would experience this simple economic phenomenon.

It is not common sense, stop saying what you don’t know. I send money back home coz I’m one of diaspora Nigerian. In your example, the reverse will be the case.

My $100 before is 70k, now my $100 is 160k. People you give urgent 50k to increased more than 2folds. So how does that miraculously mean you part away more fund?

The only thing you can say is that if you have projects you’re doing in Nigeria, it could push you to invest more now. For example, if you have plot of land you allow to lie there unchecked, it’s very easy to build it coz the psychology will tell you that your dollar now hold more value. That’s part of the reason for the inflow.

When they devalue your currency, it attracts more foreign investment faster.

[quote]Currency depreciation creates an incentive for diasporans to remit more funds back home, just the same way it lures foreign investors to pump more funds into an economy; there's a reason countries like China deliberately devalues their currency from time to time.

You are correct about this. It is exactly what I tried explaining above.

Also before, the IMTO don’t remit that money through the official channel much, so with CBN coming in, they’ve agreed and they now use the official channel often.

Investment is different from money you give to family. I think that’s where we had disagreement earlier but it seems you’ve corrected yourself. FDI, Family remittance, investment are different things.

LegendHero:
Yes, it is the special policy. Cardoso mentioned that in April 2024 at the IMF meeting. What they did was reconnect with IMTO and streamline the inflow more easier for them to use the official channel. Before then, it was someone hard. Check the screenshot below.


It is not common sense, stop saying what you don’t know. I send money back home coz I’m one of diaspora Nigerian. In your example, the reverse will be the case.

My $100 before is 70k, now my $100 is 160k. People you give urgent 50k to increased more than 2folds. So how does that miraculously mean you part away more fund?

The only thing you can say is that if you have projects you’re doing in Nigeria, it could push you to invest more now. For example, if you have plot of land you allow to lie there unchecked, it’s very easy to build it coz the psychology will tell you that your dollar now hold more value. That’s part of the reason for the inflow.

I guess basic economics isn't exactly 'common sense' as I assumed, so my bad!

I'm going to leave you with the same thing I said before though, i.e. the real factors influencing the increased diasporan remittances are:
1. Naira depreciation which motivates diasporans to send more money home.
2. Inflation and hardship in Nigeria which is forcing diasporans to have to send more funds back home to support family members.

I'm a diasporan myself and I know from first hand experience how the exchange rate influences my decision and the decision of people around me to send money home. I also know from first hand experience how much more pressure I'm under to send support funds to family and friends these days.

It's okay if you dont agree with me, it's okay if you choose to believe the increased remmitances is due to some magic performed by CBN governor.

obailala:
I guess basic economics isn't exactly 'common sense' as I assumed, so my bad!

I'm going to leave you with the same thing I said before though, i.e. the real factors influencing the increased diasporan remittances are:
1. Naira depreciation which motivates diasporans to send more money home.
2. Inflation and hardship in Nigeria which is forcing diasporans to have to send more funds back home to support family members.

I'm a diasporan myself and I know from first hand experience how the exchange rate influences my decision and the decision of people around me to send money home. I also know from first hand experience how much more pressure I'm under to send support funds to family and friends these days.

It's okay if you dont agree with me, it's okay if you choose to believe the increased remmitances is due to some magic performed by CBN governor.

I agree with point number one and disagree with point number 2.

Your $ is constant since you’re sending it from abroad. Depreciation means you dollar have more value in naira terms.

Before, if you’re giving one of your family member 300k monthly which is roughly $428 before Tinubu, do you mean to say because of inflation, you will be forced to increase the $428 to $800 which will translate to 1.2m using current N1600 to $1 rate?

Think before you speak nao. What common sense and inflation will double that value in dollar terms?

The increase is due to two things:
1. CBN Governor restructuring how IMTO remit into official channel
2. Devaluation because that means people will be encouraged to invest more in Nigeria through FDI flow and diaspora investments.

LegendHero:
I agree with point number one and disagree with point number 2.

Your $ is constant since you’re sending it from abroad. Depreciation means you dollar have more value in naira terms.

Before, if you’re giving one of your family member 300k monthly which is roughly $428 before Tinubu, do you mean to say because of inflation, you will be forced to increase the $428 to $800 which will translate to 1.2m using current N1600 to $1 rate?

Think before you speak nao. What common sense and inflation will double that value in dollar terms?

The increase is due to two things:
1. CBN Governor restructuring how IMTO remit into official channel
2. Devaluation because that means people will be encouraged to invest more in Nigeria through FDI flow and diaspora investments.

If I was supporting 2 people before, the current inflation and hardship means the number of struggling people I'm having to support now are like 10, so even the N1.2m is barely enough. My Nigerian bank account bled terribly in the last week, and this is the same story for a lot of people I know.