CBN sets naira rate for foreign school and medical fees


By Paul Carsten and Oludare Mayowa

ABUJA/LAGOS, March 27  – Nigeria’s central bank on Monday said it will sell the dollar to consumers needing to pay foreign school and medical fees at 360 naira after the local currency firmed sharply on the black market.

It amount to an increase of arund 4 percent since it was last set.

Nigeria has at least five exchange rates — the black market, the official one, a rate for Muslim pilgrims going to Saudi Arabia, one for school and medical fees abroad, and a retail rate set by licensed exchange bureaus.

The central bank has been selling the U.S. currency on the official currency market to try to narrow the spread with the black market rate, which was at 390 last Friday, albeit down from 520 to the dollar a month ago.

On Monday the bank said it will sell dollars at 357 to lenders to resell to customers at a 3 naira margin for foreign school fees, medical bills and travels.

On the official market, the bank has also been weakening the naira to converge rates, traders say, but it has not provided a target rate. The naira was quoted at 315 on the interbank market.

The central bank said its supervisors would visit lenders to ensure compliance with the new retail rate and barred them from reselling foreign currency to retail exchange bureaux.

Aminu Gwadabe, head of Nigeria exchange bureaus, told Reuters his members had incurred currency losses of 130 million naira based on the rate differential after the central bank sold $25 million to them at 381 naira last week.

He said on Monday that exchange bureaus may boycott central bank sales this week, adding that the regulator must review the multiplicity of rates on the currency market.