The Central Bank of Nigeria (CBN) has debunked rumours that it plans to forcefully convert $30 billion in the domiciliary accounts held by Nigerians to Naira.
The bank dismissed the report as “fake news” in a tweet on Saturday, urging the public to disregard such speculations.
“No plans to convert $30bnillion domiciliary deposits to Naira. This news is fake!,” the post reads.
Origin of the rumour:
The source of the news remains unclear, though some online reports link it to previous policy proposals regarding domiciliary accounts. Notably, in early February 2024, discussions emerged around “Operation Rescue Naira,” an initiative reportedly considering various measures to incentivize the conversion of foreign currency holdings to naira. While the details of this initiative remained hazy, it likely fueled the recent anxieties surrounding domiciliary accounts.
Potential impact:
The rumor’s spread had the potential to create significant economic turbulence. Domiciliary accounts represent a crucial component of Nigeria’s foreign exchange reserves, and any mass conversion could trigger market instability and currency depreciation. Additionally, such a move could erode public trust in the financial system and discourage future foreign investment.
CBN’s reassurance:
The CBN’s prompt and unequivocal denial aims to quell these concerns and restore confidence in the stability of the financial system. Their reassurance likely brings temporary relief to account holders and helps maintain market stability.
Looking forward:
The CBN’s swift response to the $30 billion conversion rumor signifies its commitment to maintaining financial stability and addressing public concerns. However, the episode underscores the vulnerability of the financial system to misinformation and the need for proactive communication and financial literacy initiatives.
It remains to be seen what future policies the CBN may pursue regarding domiciliary accounts and how they will effectively address public anxieties while ensuring economic stability.