Nigeria experienced an 11.78% decline in remittance inflows through International Money Transfer Operators in the first half of 2025, with total receipts falling to $2.07 billion from $2.34 billion in the same period of 2024—a shortfall of $275.93 million.
The figures, drawn from the Central Bank of Nigeria’s latest Quarterly Statistical Bulletin released on December 24, highlight persistent challenges in channeling diaspora funds through formal channels, even as remittances remain a vital lifeline for household consumption and foreign exchange liquidity.
The drop comes despite aggressive CBN reforms aimed at boosting inflows, including removing exchange rate caps for IMTOs in January 2024, revising operational guidelines to enhance competition, and establishing a Collaborative Task Force—reporting directly to Governor Olayemi Cardoso—to double remittance volumes. These measures had propelled a 44.5% surge to $4.76 billion in full-year 2024 inflows, but momentum has not carried into 2025.
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Quarterly and Monthly Breakdown: Q1 2025 (Jan-Mar): $888.39 million, down 17.9% ($193.14 million) from $1.08 billion in Q1 2024—the sharpest quarterly fall.
- January: $281.97 million (-27.8% from $390.86 million).
- February: $288.82 million (-11.6% from $326.91 million).
- March: $317.60 million (-12.7% from $363.76 million).
- Q2 2025 (Apr-Jun): $1.18 billion, down a milder 6.6% from $1.26 billion in Q2 2024, cushioned by an April spike.
- April: $597.44 million (+28.2% from $466.11 million)—the only month with growth.
- May: $288.17 million (-28.8% from $404.75 million).
- June: $292.25 million (-25.0% from $389.79 million).
The April surge softened the overall half-year decline but proved anomalous, with inflows weakening again in May and June amid seasonal and economic factors.
Diaspora remittances rank as Nigeria’s second-largest foreign exchange source after oil exports, contributing roughly 5-6% to GDP and supporting millions of households amid inflation averaging 30%+ in 2025.
Formal IMTO channels (Western Union, MoneyGram, Ria, etc.) captured the bulk, but informal transfers—via hand-carried cash or unregistered networks—likely offset some decline, though harder to quantify. The World Bank estimates total remittances (formal and informal) at $20-25 billion annually, underscoring their role in poverty alleviation and economic stability.
Reasons for the Decline
Industry stakeholders attribute the slowdown to a mix of domestic and global headwinds, such as inflationary pressures in advanced economies, such as the US, UK, EU, tighter labor markets, tougher migration policies, and potential shifts to informal channels due to naira volatility.
The World Bank notes that while global remittances to low- and middle-income countries grew 1.5% to $690 billion in 2025, Sub-Saharan Africa saw subdued flows due to economic slowdowns in host nations.
Broader Implications
As Nigeria’s external reserves hover around $40-46 billion, weaker remittances pressure the balance of payments at a time of high debt service of $2.32 billion, as of H1 2025, and import dependence.
A 10% increase in remittances correlates with 2% GDP growth (World Bank estimates), fueling sectors like fintech, e-commerce, and edtech.
While Nigeria’s H1 formal inflows declined, full-year projections remain optimistic at $23 billion—up from $19.5 billion in 2023 and representing 35% of Sub-Saharan Africa’s total, driven by diaspora engagement and digital platforms.
Globally, remittances to low- and middle-income countries grew 1.5% to $690 billion in 2025. Africa saw inflows surge to $95 billion in 2024.
Latin America bucked the trend with 10.9% growth in Q1 2025, highlighting Nigeria’s underperformance relative to peers.