THE CBN NEW FREE FLOATING FOREX POLICY
We all woke up to the CBN New Free Floating Forex Policy on the news yesterday, 15th June, 2023 stating that the CBN would no longer peg the Naira at a certain rate versus the dollar, and also Local Banks had been given the permission to trade the naira against the U.S dollar based on a free market.
This means that the Naira’s exchange rate against the dollar will be determined through supply and demand rather than by the central bank.
All banks, including the CBN, are allowed to set their own rate, primarily determined by what the market offers which eliminates the need for a parallel or black market.
WHAT WOULD THIS NEW POLICY MEAN FOR YOU AS YOU AS AN INTERNATIONAL STUDENT AS YOU PREPARE TO PAY FOR YOUR STUDIES THIS SEPTEMBER?
What is immediately glaring is that as a student wanting to pay your tuition fees abroad, you would no longer be able to make use of the CBN forex rate through FORM A as had been the case.
Each bank would now determine what rate they would charge to fulfil international payments to foreign institutions.
And this is expected to increase the rates that students would be expected to pay.
For instance, a quick check on OANDA.com revealed that the Naira rose from around 586 as at yesterday, to 625 to a pound this morning (16th, June 2023).
Over the next couple of weeks, it is expected that the Naira rates versus the major currencies would fluctuate steadily as the Naira battles against the dollar and as such, students should be prepared to pay more money to secure their offers and prepare their financial statements for proof of funds.
We would be holding an Instagram live session next week (21st, June 2023) to shed more light on what you can do as a student wanting to study this September.
For more Information on The CBN New Free Floating Forex Policy and how to go about these new changes, click here to speak with one of our counsellors.
