The Central Bank of Nigeria (CBN) has announced the upcoming launch of a new Electronic Foreign Exchange Matching System (EFEMS) aimed at enhancing transparency and governance in the foreign exchange (FX) market. According to a circular issued by Omolara Duke, the CBN's Director of the Financial Markets Department, the system is set to go live by December 1, 2024, following a two-week testing phase in November.
In the circular, the CBN stated that all authorized dealers will be required to conduct foreign exchange transactions in the interbank FX market using the EFEMS. This system will allow transactions to be recorded in real-time, providing immediate visibility into market activities.
The introduction of EFEMS is expected to create a more market-driven exchange rate and improve overall transparency, making information more accessible to the public. The CBN anticipates that this development will help reduce speculative activities, eliminate market distortions, and enhance its regulatory oversight.
Additionally, the CBN plans to publish real-time pricing and buy/sell order data through the new system. In collaboration with the Financial Markets Dealers Association (FMDA), the CBN will release operational guidelines for EFEMS.
To ensure a smooth transition, the CBN has advised authorized dealers to comply with all existing FX market regulations and finalize necessary documentation, training, and system integrations ahead of the launch date. The CBN also mentioned that the Nigerian FX Code and updated Market Operating Guidelines will provide further guidance to market participants.
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