Victor Ufot Backs CBN Forex Reforms, Calls For Market Discipline

By Olumide Johnson

Victor Ufot, Managing Director of TenTrade Africa, has argued that Nigeria’s foreign exchange and retail trading ecosystem must move beyond expanding participation towards building stronger market discipline, embedded risk governance and institutional credibility, a position that aligns with the Central Bank of Nigeria (CBN)’s newly unveiled Fourth Edition of the Foreign Exchange Manual. The revised framework, which takes effect from June 1, 2026, introduces reforms aimed at improving market transparency, liquidity, compliance and operational efficiency through new rules covering Personal Travel Allowance (PTA), Business Travel Allowance (BTA), export proceeds, import payments, remittances, service exports and foreign exchange administration.

DECISION HIGHLIGHT

Ufot’s call for institutionalising discipline across Nigeria’s retail trading ecosystem reinforces the CBN’s regulatory reforms, suggesting that sustainable foreign exchange market development will require both stronger regulation and more responsible market participation.

DECISION MEMO

Nigeria’s foreign exchange reforms are increasingly being shaped by two complementary forces. The first is regulatory modernisation led by the Central Bank of Nigeria. The second is a growing recognition among private market operators that sustainable market development depends as much on participant behaviour as on policy design.

According to Ufot, “The first phase of retail trading growth was about democratising access. The next phase must be about institutionalising discipline.” He argues that although retail trading participation across emerging markets is likely to continue expanding, long-term credibility will depend on stronger market structures, embedded risk governance, transparency and disciplined participation rather than rapid growth alone.

He believes that access is no longer the industry’s principal challenge. Instead, he contends that the ecosystem must move “from access to structured participation, from volume-driven growth to sustainability-driven growth, from optional risk management to embedded risk governance, and from fragmented learning to structured development pathways.”

Ufot advances the same institutional argument from the perspective of market operators. He maintains that responsible trading platforms should not merely facilitate access but should actively shape behaviour through embedded risk controls, structured progression, behavioural feedback and incentive alignment. In his view, “The real responsibility is helping shape how that access is used.” He further argues that “The system itself should support responsible behaviour,” transforming platforms from simple trading gateways into institutional frameworks that encourage discipline, consistency and resilience.

That philosophy closely reflects the direction now being pursued by the CBN.

Launching the revised Foreign Exchange Manual in Abuja, Mr. Olayemi Cardoso, Governor of the CBN, said, “This unveiling reflects our collective commitment to strengthening Nigeria’s macroeconomic foundations, enhancing transparency, and reinforcing confidence in the foreign exchange market.”

Cardoso explained that the revised manual responds to changing global economic conditions and domestic structural reforms.

“Over the past decade, the global economy has become increasingly complex and uncertain, while the domestic economy has undergone structural adjustments, including efforts to diversify foreign exchange earnings and manage inflationary pressures,” he said.

He added, “This Fourth Edition is the result of extensive consultation and rigorous technical review, aligned with international best practices. It reflects our commitment to modernising foreign exchange administration to enhance clarity, consistency, and market efficiency. The Manual will take effect on June 1, 2026.”

The Governor further stressed that implementation would depend on broad stakeholder cooperation.

“Your adherence is essential, your cooperation indispensable, and your partnership remains central to the stability and credibility of the Nigerian foreign exchange market,” Cardoso said.

Supporting the reform programme, Dr Muhammad Abdullahi, Deputy Governor of CBN, Economic Policy Directorate, described the revised manual as “part of a broader and deliberate institutional reform effort designed to strengthen the integrity, credibility, and effectiveness of Nigeria’s foreign exchange ecosystem.”

According to Abdullahi, “Our goal is to reduce transaction frictions, improve processing timelines, deepen market confidence, encourage formal market participation, and create a more seamless and efficient experience for legitimate users of Nigeria’s foreign exchange market.”

Taken together, the CBN’s regulatory reforms and Ufot’s market philosophy suggest that Nigeria’s foreign exchange ecosystem is gradually evolving beyond market access towards institutional quality. The convergence reflects an emerging consensus that transparency, compliance, disciplined participation and effective risk governance are becoming as important to market development as liquidity itself.

Representing the Minister of Finance and Coordinating Minister of the Economy, Mr. Mohammed Danjuma, Permanent Secretary, Special Duties, described the revised manual as “a strategic tool to improve transparency, operational efficiency, and investor confidence in Nigeria’s foreign exchange market,” adding that it would “significantly improve market discipline, support ease of doing business, and align our practices with international standards and global best practices.”

Similarly, Mr. Oliver Alawuba, Chairman of the Body of Banks’ Chief Executive Officers and Group Managing Director of United Bank for Africa (UBA), said, “The table has been turned. There’s so much greater confidence in the Nigerian economy, thanks to the reform that has been conducted by the CBN,” while pledging industry support for implementation.

DATA BOX

• CBN Foreign Exchange Manual takes effect: June 1, 2026.
• Ufot’s strategic thesis: Institutionalise discipline rather than simply expand participation.
• CBN reforms include:
  • 75 percent of PTA and BTA electronically disbursed; 25 percent cash.
  • Import advance payment threshold increased from 15 percent to 30 percent.
  • Free processing of Form NXP.
  • New provisions covering service exports, PAPSS transactions, technology company remittances and non-resident investment accounts.
  • Tuition payments up to $25,000 per semester.
  • Unfettered access to export proceeds and domiciliary accounts.
  • 100 percent repatriation of export proceeds for foreign extractive companies.
  • Removal of mandatory Form A requirement for remittances through ordinary domiciliary accounts.

WHO WINS / WHO LOSES

Winners

• Investors seeking a more transparent foreign exchange market.
• Exporters, importers and authorised dealer banks operating under clearer rules.
• Responsible trading platforms promoting disciplined participation.
• Legitimate market participants benefiting from stronger institutional governance.

Losers

• Operators exploiting regulatory ambiguity.
• Market practices dependent on weak compliance and poor governance.

POLICY SIGNALS

The emerging direction of Nigeria’s foreign exchange market extends beyond regulatory reform. It increasingly combines stronger public-sector oversight with private-sector advocacy for disciplined participation, risk governance and institutional market development.

INVESTOR SIGNAL

The convergence between the CBN’s regulatory reforms and Victor Ufot’s market philosophy strengthens confidence that Nigeria’s foreign exchange ecosystem is moving towards internationally recognised standards of transparency, compliance and sustainable market development. For investors, the reforms suggest a gradual transition from policy-driven market management towards institution-driven market credibility, where liquidity is reinforced by stronger governance and participant discipline rather than regulatory intervention alone.

RISK RADAR

The reforms will ultimately be judged by implementation. Regulatory improvements must be matched by sustained compliance, stronger market supervision and broader adoption of responsible trading practices. Without corresponding improvements in participant behaviour and institutional discipline, higher market participation alone may not translate into greater market resilience.