The Central Bank of Nigeria (CBN) has introduced a N100 million penalty for financial institutions that conduct foreign exchange transactions without adequate supporting documentation, under a revised regulatory framework contained in its newly released Foreign Exchange Manual.
According to the apex bank, authorised dealers will now pay N100 million plus an additional N10 million per transaction where FX deals are executed with insufficient documentation. The provision is part of efforts to strengthen compliance, improve transparency, and curb misconduct in Nigeria’s foreign exchange market.
The updated manual, issued by the CBN’s Trade and Exchange Department in May 2026, is the first comprehensive revision since 2017. It is designed to serve as a regulatory guide for banks, exporters, investors, and other participants in the FX ecosystem.
The CBN said the framework aims to improve oversight of foreign currency inflows and outflows, enforce stricter documentation standards, and ensure FX resources are channelled toward productive economic activities.
Beyond the headline penalty, the manual introduces a tiered sanction system for violations. Banks that exceed approved Net Open Position limits will face escalating penalties, starting with a warning, followed by a 10-day suspension from the FX market for a second offence, and a 90-day suspension for a third breach.
The apex bank also tightened reporting requirements for authorised dealers, mandating daily FX transaction returns by 10 a.m. the following day and monthly submissions within five working days after each month-end. Late submissions will attract a N500,000 fine, while failure to submit carries a minimum penalty of N5 million, plus additional daily charges.
The CBN further warned against the reclassification of FX transactions without regulatory approval, noting that violations could result in financial penalties, suspension of dealer licences for at least six months, or outright revocation.
Import and export transactions also feature stricter compliance timelines. Importers are required to submit Exchange Control Documents within 90 days of negotiating shipping documents, with repeated violations attracting increasing restrictions, including permanent exclusion from FX transactions after multiple breaches.
Exporters must repatriate proceeds within 180 days for non-oil exports and 90 days for oil and gas exports. Failure to comply attracts penalties of 1 per cent of the naira value of outstanding proceeds for exporters, while banks face fines of 0.5 per cent for lapses in enforcement.
The manual also introduces operational adjustments, including higher advance payment thresholds for imports, revised margins for Form M processing, and the removal of Form NXP processing fees. Additional provisions cover service exports, digital payments, and tuition-related foreign remittances.
The CBN said the reforms were developed after consultations with financial institutions, regulators, and development partners, and are aimed at building a more transparent, efficient, and market-driven FX system.
CBN Governor Olayemi Cardoso described the changes as part of broader efforts to strengthen macroeconomic stability and modernise Nigeria’s foreign exchange operations, while senior officials said the framework is intended to rebuild market confidence and improve liquidity.