The Central Bank of Nigeria (CBN) has announced the introduction of Electronic Foreign Exchange Matching System (EFEM), for Foreign Exchange transactions in the Nigerian Foreign Exchange Market (NFEM) to be implemented not later than December 1, 2024. There will be a 2 weeks test run in the month of November.
According to the CBN the new system is expected to enhance governance, transparency, and facilitate a market-driven exchange rate accessible to the public.
“The system is expected to curb speculative activities, reduce market distortions, and provide the CBN with improved oversight capabilities for regulating the market effectively.
The CBN said it will publish real-time data on prices and buy/sell orders from the EFEMS. Additionally, in collaboration with the Financial Markets Dealers Association (FMDA), the CBN will release the rules for operating the system.
It added that the Nigerian FX Code and revised Market Operating Guidelines will also offer guidance to market participants.
Authorized Dealers are thereby required to ensure full compliance with the existing guidelines governing the Nigerian foreign exchange market and must complete all necessary documentation, training, and system integrations ahead of the December go-live date”.