Senate moves to ban foreign currencies in Nigeria, insist on Naira-only transactions

A new bill aimed at banning the use of foreign currencies, including the US Dollar and British Pound Sterling, for domestic transactions in Nigeria has passed its first reading in the Senate.

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 Other Related Matters,” was introduced by Senator Ned Nwoko, Chairman of the Senate Committee on Reparations and Repatriation.

The proposed legislation seeks to make the Naira the sole legal tender for all payments, salaries, and financial transactions conducted within Nigeria.

In presenting the bill, Senator Nwoko expressed concern over the widespread use of foreign currencies in the country’s financial system, which he described as a “colonial relic.”

He argued that such practices undermine the value of the Naira, perpetuating economic challenges and weakening Nigeria’s monetary independence.

“The extensive use of foreign currencies in our financial transactions continues to erode the value of the Naira and fosters a dependency that hinders Nigeria’s economic sovereignty.

“This legislation is a step toward restoring confidence in our local currency and reducing unnecessary pressures on our economy,” Nwoko stated.

If enacted, the bill will prohibit the use of foreign currencies for salaries, bonuses, and other forms of remuneration, as well as for local transactions. It aims to promote the adoption of the Naira, strengthen the economy, and encourage the use of the country’s own resources.

While the proposed law has garnered support for its potential to boost the Naira’s value and promote economic stability, it is also expected to face scrutiny.

Critics may raise concerns about the bill’s feasibility, particularly given Nigeria’s heavy reliance on foreign currencies in international trade, remittances, and private sector operations.