The Central Bank of Nigeria (CBN) on Wednesday, March 25, said it has scrapped the cash pooling requirement for International Oil Companies (IOCs), granting them full access to their export proceeds.
Cash pooling is a financial arrangement where a company (or regulator) centralises cash from multiple accounts into one place to manage it more efficiently.
In a circular, the bank stated that the new policy replaces guidelines introduced in 2024, which required banks to pool 50 percent of repatriated export proceeds on behalf of IOCs, while the remaining balance had to be retained for 90 days before repatriation.
Under the revised framework, oil firms are now allowed to access and repatriate 100 percent of their export proceeds.
The directive, signed by Musa Nakorji, director of the trade and exchange department, takes immediate effect.
“IOCs are hereby granted unfettered access to their repatriated export proceeds. They may repatriate 100 percent of their export proceeds through the ADBs,” the circular stated.
The CBN explained that the move is aimed at further liberalising the foreign exchange market in line with current economic realities.
Authorised Dealer Banks (ADBs) have been instructed to ensure proper documentation of such transactions and submit monthly reports to the CBN’s trade and exchange department.
The bank clarified that this directive overrides all previous circulars relating to cash pooling.
This policy forms part of broader efforts by the CBN to deepen the Nigerian FX market and enhance efficiency in FX transactions.
On February 14, 2024, CBN placed limits on the transfer of proceeds from crude exports by IOCs to offshore parent company accounts.
The apex bank said the transfer of export proceeds by the IOCs has an impact on liquidity in the domestic FX market.
Two months later, the regulator said IOCs can sell their 50 percent balance of repatriated export proceeds in the Nigerian foreign exchange market.
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