Britain Approves Naira For Transaction Payments

Britain’s export finance agency, UK Export Finance (UKEF) has approved Naira for transaction payments in Britain and from Nigeria.

The agency said the Naira approval is for funding transactions that promote trade with Britain.

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Reiterating this development, Ben Ainsley, head of the department for international trade (DIT), Nigeria, has said that the approval is based on an agreement between Nigeria and the UK which resulted from the UK trade envoy’s visit to Nigeria in November 2022.

According to him, UK is excited to offer businesses in Nigeria and in Britain the ability to enter trade arrangements that are financially feasible for both sides.

Earlier commitment:

Some few years back, the UK agency had said that the Naira financing structure follows the same format as a conventional buyer credit in Pound sterling or any other currency.

What It Means:

The policy means that Nigerians can make payments for transactions right there in UK using Naira.

Also, they can equally make transactions from Nigerian banks using their Naira.

Meanwhile, the agency said Nigerians making transactions in the UK through loan financing in naira from a bank in Nigeria can benefit from the British government-backed guarantee.

“UK government will now be able to support finance in naira to Nigerian projects procuring from the UK,” the statement read.

The agency said this will enable businesses to manage foreign exchange risks and, many times, to bargain better terms with local banks.

“The arrangement shows the kind of value the UK places on its relationship with Nigeria”, said Paul Arkwright, the British high commissioner to Nigeria.

The high commissioner said that the approval will provide a firm platform for a significant increase in trade and investment between Britain and Nigeria.

This development makes Nigeria one of the three West African countries on UKEF’s pre-approved currencies list.

UKEF provides a range of innovative and flexible products, providing up to 85 percent funding for projects containing a minimum of 20 percent UK content.

Requests will be assessed on an application basis through the UK Department for International Trade, Nigeria, and UKEF in London.

Anyone interested is encouraged to contact the UK Department for International Trade in Nigeria for guidance.