Finance

Easing access to forex through e-Form A

Banking sector lending to critical sectors still paramount –CBN

The Central Bank of Nigeria (CBN) late last year unveiled a new platform, the ‘e-Form A’, to ease access to forex by end users, viewed as a necessary intervention to overcome difficulties associated with the foreign exchange management and delivery chain. Group Business Editor SIMEON EBULU reports.

The Central Bank of Nigeria’s (CBN’s) rollout of the e-Form ‘A’ to address forex access for credible end users, wasn’t borne out of a desire to lengthen the list of policy measures on foreign exchange management and disbursement, but it was essentially designed to cut off human interface often fingered as one of the major hiccups in the process of making hard currency available to those legally in need and who qualify to obtain it in accordance with the bank’s regulations.

More often than not (and this has been proven to be true), Nigerians seeking to travel overseas and seeking to obtain dollars, or pound sterling, including the Euro, usually meet a gridlock when they approach the banks to process documents for forex. It’s been reported and verified in many cases, that a good number of persons are either denied the greenback by their banks for whatever reasons, or sometimes they are unduly subjected to meeting unrelated conditions not envisaged by them, and certainly not in the line of the apex bank’s purview. Some other times, the customers are made to keep several appointments that at the end, tend to frustrate, or truncate the purpose for which the forex request was initiated.

Complaints upon complaints of one nature, or the other have pushed the CBN over time to continue to vary and amend the rules, so much so that on the issue of forex, it was becoming like a lost battle. But a relentless CBN and its Governor, Godwin Emefiele won’t give up.

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From its policy of denial of forex to BDCs and the official forex ban, or restriction of forex to more than 41 items that the bank is certain can be manufactured locally, on the one hand, and other policies designed to increase local productive capacity for exports, on the other, the CBN has somewhat come to the conclusion, that winning the battle of making forex available and disbursing same to end users in a seamless manner, devoid of rancour and the blame-game, would for all time remain elusive, if the one factor of human interface between seekers and providers of hard currencies, was not addressed.

Along the forex management trajectory route, so far, there appears to be no saints, human or institutional. From source to end users, poachers abound, combining to frustrate every efforts of the CBN to find a common ground where, at least for a season, the bank’s efforts and its forex policies can be tested and allowed to work.

Having found none as yet, after so many trials and experimentation, the CBN once again, rolled out the e-Form A, which hopefully should put some distance, or insulate  the people involved in this intricate forex management exercise, one from another.

The kernel of the e-Form ‘A’ in the processing of forex, is the migration of applications for forex to the online platform, such that all the activities involved from when a person applies for and obtains the requisite currency, either for PTA/BTA, medicals, education and others, are done electronically with timelines. This is about the third month in the life of this policy since the CBN Director, Trade and Exchange Department, Dr. Ozoemena Nnaji unveiled the policy in November, 2021, in a circular, headlined, ‘’of Form ‘A’ on the Trade Monitoring System.”

The introduction of the new measure foreclosed the usage of all hard copies of Forms ‘A’ created on or before November 2, 2021. A 15-day allowance was given by CBN to allow for those in possession of the hard copy of the Form A to utilise them, or forfeit same if the deadline was not met.

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 Features of e-Form ‘A’

According to the apex bank, the ‘e-Form A’ represents an application form designed by the CBN to pay for service transactions under invisible trade. The form allows customers to purchase forex at the CBN or interbank rate and to make payments for eligible services as predetermined by the foreign exchange manual.

Taken together, the e-Form ‘A’, is meant to replace the hard copy and customers using the e-Form A are required to pay a charge of N5,000 as fee per declaration of e-Form ‘A’. The CBN in its circular introducing the electronic system, outlined the features of the e-Form ‘A’ thus: “The e-Form ‘A’ shall replace the hard copy of Form ‘A’ for invincible transactions [PTA/BTA, medicals, education, other remittances with effect from November 30, 2021,” saying  “all authorised dealers are required to ensure that the processing of Form ’A’ shall only be done electronically on the Trade Monitoring System accessible at http://www.tradesystem.gov.ng.”

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The bank said the general public is required to obtain a valid Bank Verification Number (BVN) from their authorised dealer banks, pointing out that the BVN is a prerequisite for customers to access the Trade System for e-Form ‘A’ application.

The e-Form ‘A’, the CBN said, is web-based and allows the general public to initiate the Form from their offices/homes and submit same to the authorised dealer bank, adding that a charge of N5,000  fee per declaration of e-Form ‘A’ is applicable. The fee, the bank said, took effect from November 30, 2021. According to the apex bank, “there will be a direct debit from the processing bank’s current account for each declaration which should be recovered along with the charge on the customer by the bank. However, customers for the e-Form ‘A’ should be separated from other bank charges.”

The CBN expressly stated that all hard copies of Forms ‘A’ established on, or before November 2, 2021 (prior to the commencement of the e-Form ‘A’) shall be utilised within 15 working days of the establishment of the form. “For the avoidance of doubt, all established hard copies of Forms ‘A’ for which disbursement had not been made within the transition period of 15 working days shall be deemed cancelled,” the CBN stressed, instructing in the main, that banks were required “to inform their customers of the development for compliance.”

The introduction of the ‘e-Form A’ is another of several initiatives of the CBN to ensure easy access to forex and related services by bank customers.

Thenation

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