The National Bank of Ethiopia (NBE) has unveiled a strategic initiative to enhance foreign currency inflows by launching a six-month campaign to increase remittances. The campaign involves government agencies, financial institutions, diplomatic missions, and the diaspora and is part of broader efforts to stimulate hard currency generation.
NBE has advised financial institutions to offer zero remittance fees, and banks have been authorized to extend loans totaling Birr 100 billion under a new credit expansion cap. Governor Mamo Esmelealem Mihretu emphasized the importance of providing attractive services to individuals transferring money through legal channels. The recent macroeconomic reforms, including exchange rate floating, have reduced the gap between the official and parallel market rates, making legal remittances more appealing.
The Commercial Bank of Ethiopia (CBE) has already introduced highly competitive rates, offering over Birr 121 per dollar for remittances, which surpasses both daily transaction rates and black market offers. Several private banks have also followed suit, launching similar incentives to attract remittance flows.
Despite these improvements, experts warn that the limited allocation of foreign currency for private travelers and importers continues to push individuals toward illicit sources. NBE’s reforms are expected to boost export and remittance revenues, further stabilizing the foreign exchange market.
Source: Capital Ethiopia
