CBN moves against forex abuse

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The Central Bank of Nigeria, CBN,  has moved against unscrupulous Nigerians and corporate, who abuse the Form M system through over-pricing as it introduces Product Price Verification Mechanism (PPVM).

 

It has, therefore, directed authorised dealers to use the PPVM to verify quoted prices of goods and services before approving Form M for their customers.

In a circular referenced: TED/FEM/FP/GEN/01/005, dated August 24, 2020 and signed by the Director of Trade and Exchange, Dr Ozoemena Nnaji, the apex bank also directed authorised dealers to stop opening Form M which payment are routed through a buying company/agent or any third party.

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It said: “As part of continued efforts by the CBN to ensure prudent use of our foreign exchange resource and eliminate over-invoicing, transfer pricing, double handling charges, and avoidable cots that are ultimately passed to the average Nigerian consumers, authorised dealers are hereby directed to desist from opening Form M which payments are routed through a buying company/agent or any third parties.

“Accordingly, all authorised dealers are hereby requested to only open Form M for Letters of Credit, Bills for Collection and other forms of payment in favour of the ultimate suppliers of the product or service.

READ ALSO:CBN moves to ban importation of maize

“Additionally, in line with best practices around the world, the CBN will be immediately introducing a Product Price Verification Mechanism to forestall over-pricing and /or mispricings of goods and services imported into the country.

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“All authorised dealers shall use this mechanism to verify quoted prices before Form M is approved.“

The bank said that the directive was with immediate effect and that Authised Dealers must ensure strict compliance.

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