CBN Moves to Reduce International Money Transfer Fees for SMEs Under New Payment Reform Plan

The Central Bank of Nigeria has announced plans to reduce the cost of international money transfers for small businesses as part of a broader financial reform agenda under its proposed Payment System Vision 2028.

Speaking in Abuja during the Technical Group Meetings of the Intergovernmental Group of Twenty-Four, the Governor of the Central Bank of Nigeria, Olayemi Cardoso, disclosed that the apex bank is finalising reforms aimed at strengthening financial system stability, boosting cross-border payments, and expanding access to banking services across Nigeria.

Cheaper Cross-Border Payments for SMEs

According to the governor, improving cross-border payment systems remains a major pillar of the new strategy. He revealed that the bank has simplified Know-Your-Customer and anti-money-laundering requirements for small-value cross-border transactions. This move is designed to reduce compliance burdens and make it easier for Nigerian small and medium-sized enterprises to receive payments for goods and services traded within Africa.

The reforms also support the use of the Pan-African Payment and Settlement System, enabling businesses to process transactions more efficiently across African markets while reducing paperwork and settlement delays.

Cardoso noted that the CBN’s regulatory sandbox framework now allows fintech companies to test cross-border payment solutions under supervisory oversight. This approach is intended to encourage innovation in digital finance while protecting financial stability.

National Payment Stack and Real-Time Settlement

The governor further explained that Nigeria launched its National Payment Stack in June 2025 as a real-time payments infrastructure built on ISO 20022 messaging standards. The platform supports multi-currency transactions and cross-border settlements, positioning Nigeria to compete in the evolving global digital payments landscape.

To address financial crime risks, the CBN has strengthened anti-money-laundering compliance by introducing dual screening requirements for international payments. These controls are aligned with international regulatory standards to enhance transparency and reduce exposure to illicit financial flows.

Cardoso warned that outdated global payment systems continue to impose high costs on individuals and small businesses seeking to participate in international trade. He stressed that affordable, secure, and fast money movement is essential for economic inclusion and modern commerce.

Remittance Reforms and Diaspora Investment Channels

The CBN governor disclosed that reforms implemented in 2024 removed long-standing bottlenecks in remittance inflows. New financial instruments were introduced to support Nigerians abroad, including the Non-Resident Nigerian Ordinary Account for family support transfers, the Non-Resident Nigerian Investment Account for diaspora investments, and the Non-Resident BVN platform that enables Nigerians overseas to open and manage accounts digitally.

According to the apex bank, remittance inflows currently average approximately $600 million monthly, with projections suggesting the figure could rise to $1 billion per month as reforms gain traction.

He added that cross-border payment inefficiencies continue to drive up remittance costs, which average above six percent globally. Settlement delays and strict compliance requirements also limit participation by small businesses in foreign trade transactions.

Digital Finance, Trade and Monetary Stability

Cardoso emphasized that digital innovation presents a major opportunity to lower transaction costs and speed up settlements. Tools such as interoperable payment systems, instant settlement platforms, distributed ledger technology, and secure digital identity frameworks can improve transparency while broadening financial inclusion.

He explained that properly governed digital payment systems can also enhance monetary policy effectiveness, reduce informal economic activity, and strengthen public confidence in the financial system.

Nigeria’s participation in global fintech and monetary policy discussions, including engagements during international meetings of the International Monetary Fund in 2025, reflects its intention to shape emerging global financial standards.

Cardoso pointed to Africa’s adoption of the Pan-African Payment and Settlement System as proof that regions can develop independent financial infrastructure that reduces reliance on foreign correspondent banks, lowers foreign exchange transaction costs, and supports intra-African trade.

He added that digital cross-border settlements conducted in local currencies could help diversify financial flows, reduce pressure on reserve currencies, and strengthen economic resilience among developing economies.

Risks and Regulatory Safeguards

Despite the benefits, the CBN governor cautioned that digital payment expansion carries risks such as currency substitution, exchange-rate volatility, systemic vulnerabilities from non-bank payment firms, and regulatory gaps.

He stressed that central banks must remain central to payment reforms to safeguard financial stability, oversee settlement systems, and maintain public trust. In emerging markets, he said, central banks also play a strategic role in supporting investment, employment generation, and real-sector growth through coordinated financial policies.

Finance Ministry Pushes Revenue Reforms

Also addressing the meeting, Nigeria’s Minister of Finance and Coordinating Minister of the Economy, Wale Edun, outlined ongoing efforts to increase Nigeria’s tax-to-GDP ratio to 18 percent in the medium term.

He said reforms include updated tax legislation, improved compliance systems, automation of revenue collection processes, and initiatives such as the National Single Window. Measures such as RevOp, Federal Treasury receipts integration, a Central Billing System, and the elimination of direct deductions by payment portals are expected to improve transparency and efficiency in government revenue management.

Edun emphasized that stronger economic cooperation among developing countries will be essential in a shifting global environment, particularly as nations seek to stabilise supply chains and expand trade partnerships.

G-24 Highlights Debt and Fiscal Pressures

In her remarks, Iyabo Masha, Director and Head of Secretariat of the G-24, warned that many developing economies face shrinking fiscal space as debt servicing consumes a growing share of government revenue.

She cited global figures indicating that external debt service reached $487 billion in 2023, highlighting structural financing challenges facing lower-rated economies. Masha urged policymakers to address risks such as inflation shocks, capital flow reversals, prolonged debt restructuring, and weakening human capital investment.

She stated that the 2026 meeting theme focuses on promoting sustainable, inclusive, and job-rich economic transformation. According to her, strengthening macroeconomic frameworks, expanding domestic revenue mobilisation, investing in infrastructure and human capital, and deepening regional trade partnerships will determine whether developing countries can achieve durable growth.

The Central Bank’s Payment System Vision 2028 signals Nigeria’s ambition to modernise cross-border payments, reduce remittance costs, support small businesses, and strengthen financial inclusion within a rapidly evolving global digital economy.