Nigeria’s much-needed inflow of diaspora remittances through International Money Transfer Operators (IMTOs) fell sharply by $193.14 million in the first quarter of 2025, a development that could further weaken the naira and squeeze millions of households who rely on support from relatives abroad.
Fresh data from the Central Bank of Nigeria (CBN) shows that inflows dropped to $888.39 million in the first three months of 2025 from $1.08 billion in the same period of 2024, a 17.8 per cent decline year-on-year.
The fall reflects the fragile nature of remittance flows into Africa’s biggest economy, as global economic uncertainty continues to weigh on disposable income across countries where many Nigerians live and work.
Families Feel the Pinch
For the average Nigerian, the drop in remittances is more than just a statistic, it’s a financial blow.
Millions of families depend on monthly dollar transfers from relatives in the UK, US, Canada and other parts of the diaspora to pay rent, school fees, and buy food.
With less money coming in, those households now face tougher choices.
In January 2025 alone, inflows were $281.97 million, down 27.9 per cent from $390.86 million in the same month of 2024. February and March recorded smaller but still worrying declines of 11.6 and 12.7 per cent respectively.
While inflows remain slightly above pre-2024 levels, the consistent slowdown has raised fresh concerns about the sustainability of the forex inflow that has become a lifeline for Nigeria’s economy.
Economists warn that a prolonged decline could trigger further pressure on the naira, potentially pushing up prices of imported goods, from fuel to essential commodities, and worsening the cost-of-living crisis already biting Nigerians.
Policy Push Meets Reality
The fall also comes despite CBN reforms introduced under Governor Olayemi Cardoso to boost remittance inflows.
In early 2024, the apex bank scrapped the previous cap on IMTO exchange rates, allowing operators to quote rates freely within the official market.
It also revised operational guidelines, increasing licence fees from N500,000 to N10 million and setting a minimum operating capital of $1 million for both foreign and local operators.
Those policies, coupled with a task force created to double remittance inflows, helped the country record a surge in 2024, when total IMTO inflows rose by 44.5 per cent to $4.76 billion.
However, the first-quarter dip in 2025 signals that those gains may be short-lived, especially as inflation and job cuts in advanced economies leave many Nigerians abroad with less disposable income to send home.
A Wider Economic Ripple
Remittances have become a key foreign exchange buffer for Nigeria, complementing oil revenues and helping stabilise the naira. Any slowdown threatens to deepen dollar scarcity, restrict import access, and push up prices in local markets.
The CBN, which relies on diaspora inflows to boost reserves and ease forex demand pressures, may face tougher decisions in the coming months if the trend continues.
Informal remittance channels also remain a persistent challenge, diverting funds away from official IMTO records and undermining the CBN’s efforts to capture true inflow levels.
As the government doubles down on reforms to attract more remittances through official routes, ordinary Nigerians are left grappling with rising living costs, unstable exchange rates, and shrinking financial support from abroad, a reminder that every dollar sent home still counts deeply in the country’s fragile economic recovery.
