CBN Urges Telcos to Produce SIM Cards, Other Components Locally to Save Forex
- Central Bank of Nigeria has urged telecommunication companies to embrace backward integration to reduce pressure on FX
- The CBN governor, Olayemi Cardoso, noted that if SIM cards and other components are produced locally, the telecom industry will be less exposed to FX fluctuations
- Cardoso also shared plans to drive digital and financial inclusion into rural areas and told the telcos what they must do
Legit.ng journalist Ruth Okwumbu-Imafidon has over a decade of experience in business reporting across digital and mainstream media.
The Central Bank of Nigeria (CBN) has called on companies in the telecommunications sector to consider local production of sim cards, and other components to save Foreign Exchange.
The CBN governor, Olayemi Cardoso, explained that adopting such backward integration strategies could encourage the growth of the sector, and also reduce pressure on foreign exchange.
Cardoso noted that elements such as sim cards, towers and cables could be produced locally to help the local economy, create jobs, and reduce the need for FX.
Source: UGC
Speaking during a courtesy visit from the Airtel Africa management team, led by Mr. Sunil Taldar, the group CEO, Cardoso stated that it was time for telecommunication industry players to deepen backward integration with local production of some essential components it needs.
CBN stabilises FX market
According to the Punch reports, the CBN Governor stated that the apex bank had implemented several measures in the last 16 months to address challenges in Nigeria’s foreign exchange system and boost investor confidence.
These include introducing the CBN's Electronic Foreign Exchange Matching System (EFEMS), and very recently, launching the FX code to regulate market activities.
As these efforts translate into stronger naira, the telecommunication firm can help sustain the progress by locally producing and sourcing some of the components they require FX to import.
CBN to drive digital and financial inclusion
The CBN Governor said in his statement that the bank is also working out plans to engage stakeholders to drive digital payment solutions and financial inclusion into the underserved and rural areas.
Cardoso noted that the telecommunication companies would play a key role in this drive, and urged them to cooperate with the CBN to build a digitally-driven financial ecosystem in Nigeria.
The Airtel Group CEO, Sunil Taldar, in his response, pledged that Airtel was ready to collaborate with the apex bank to drive the vision of digital and financial inclusion in Nigeria.
Taldar came into the company of the Airtel Nigeria management team; including Mr. Dinesh Balsingh the CEO; director of corporate communications & CSR, Mr Femi Adeniran, and the Group CFO, Mr Jaideep Paul.
Telcos thank CBN, NCC for intervention in N250bn debt
In related news, the telecom operators thanked the Central Bank of Nigeria for intervening in the outstanding N250 billion USSD debts owed by the banks.
The operators noted that it was thanks to this intervention that the banks finally moved to clear the debts. This recent update brings the long-standing rift between telcos and banks to a conclusive end, as most of the banks have cleared the outstanding debts.
The telecom operators had earlier marked about 18 banks for disconnection due to years-long debts accumulating from the USSD fees that the telecom operators offer customers on behalf of the banks.
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Source: Legit.ng
