The Senate has taken a significant step towards restoring Nigeria’s monetary sovereignty by proposing a legislation to ban the use of foreign currencies for salaries, transactions, and payments within the country.
The bill, titled “A Bill for an Act to Alter the Central Bank of Nigeria Act, 2007, No. 7, to Prohibit the Use of Foreign Currencies for Remuneration and for Other Related Matters,” was introduced by Senator Ned Munir Nwoko, Chairman of the Senate Committee on Reparations and Repatriation.
The proposed law seeks to strengthen confidence in the Naira, eliminate discriminatory payment practices, and make Nigeria’s local currency the primary means of financial transactions, including payments for exports.
Senator Nwoko emphasized that the use of foreign currencies, such as the Dollar and Pound Sterling, for domestic transactions undermines the Naira’s value and Nigeria’s economic independence.
“The widespread use of foreign currencies in Nigeria’s financial system undermines the value of the Naira, perpetuating economic challenges,”Nwoko said.
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“This practice is a colonial relic that continues to hinder Nigeria’s economic independence.”
The bill contains key provisions aimed at transforming Nigeria’s monetary framework, including: prohibition of salaries and payments in foreign currencies. All workers in Nigeria, including expatriates, would be paid in Naira. Exclusive use of naira for exports; crude oil and other exports would be sold in Naira, compelling international buyers to purchase the currency, thus driving demand and increasing its value and elimination of informal currency markets; the bill seeks to abolish unregulated currency markets that encourage unethical practices like round-tripping by banks.
Other highlights of the bill are affordable credit for local industries; banks would be mandated to provide loans at reasonable interest rates to support industrialization and economic growth and domestic management of foreign reserves; Nigeria’s foreign reserves would be stored locally to reduce exposure to external economic vulnerabilities.
Senator Nwoko explained that the legislation aims to reclaim monetary independence while fostering national pride and economic resilience.
“Reclaiming monetary independence by prioritizing the Naira for both domestic and international transactions will strengthen the currency’s value and build a diversified, resilient economy. We must shift the way Nigerians perceive and use the Naira,” he stated.
To ease concerns about existing domiciliary accounts, Nwoko clarified that transitioning balances to Naira would be voluntary for account holders. He assured Nigerians that as the Naira gains strength, holding foreign currencies would no longer be necessary.
He also addressed fears about access to foreign exchange for travel and legitimate needs. “Access to foreign exchange, including Basic Travel Allowance (BTA), will be streamlined through banking reforms, ensuring Nigerians’ needs are met without difficulty,” he assured.
Drawing from international examples, Senator Nwoko cited Morocco’s Dirham as a model of stability.
“The Moroccan Dirham has maintained consistent value against major currencies for over 35 years because Morocco exclusively uses its local currency for domestic transactions. Nigeria, with its vast natural resources and dynamic population, can achieve even greater success if we change our mindset,” he said.
The bill also envisions a future where Nigerian banks expand globally, offering innovative financial tools such as cashless wallets to simplify international transactions. This, according to Nwoko, would address existing challenges, including the current limitations of Nigerian debit cards for international online payments.
If passed, the legislation is expected to drive economic transformation, cultural pride, and sustainable growth anchored in the strength and dominance of Nigeria’s currency—the Naira.
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