The Central Bank of Nigeria (CBN) has announced the introduction of an Electronic Foreign Exchange Matching System (EFEMS) for foreign exchange transactions in the Nigerian Foreign Exchange Market (NFEM).

The CBN Director of the Financial Markets Department, Omolara Duke, made this known in a statement on Thursday, October 3, 2024.

Duke noted that the system will be implemented by December 1, 2024.

Duke said the new matching system would help to enhance governance, transparency, and facilitate a market-driven exchange rate that would be accessible to the public.

She stated: “This development is expected to reduce speculative activities, eliminate market distortions, and give the CBN improved oversight capabilities to effectively regulate the market.

Naira trades N1,669/$ at official market

“Authorised dealers will subsequently conduct all foreign exchange transactions in the interbank foreign exchange market on the EFEMS approved by the CBN where transactions will be reflected immediately.”

The CBN official noted that there would be a two-week test run in November, adding that the apex bank would publish real-time prices when the EFEMS becomes operational.

Duke said the CBN would also buy and sell orders from the matching system and in collaboration with the Financial Markets Dealers Association (FMDA), publish the rules for the EFEMS.

Duke added: “The Nigerian FX Code and revised Market Operating Guidelines for the Nigeria Foreign Exchange Market will also provide guidance to market participants.

“Authorised dealers are, therefore, required to comply with extant guidelines and regulations governing the Nigeria foreign exchange market.

“They should ensure that all necessary documentation, training, and systems integrations are concluded ahead of the go-live date.”

The Star