Chart of the Week: CBN policy affects Nigerian households' $21 billion remittances

Nigeria claims 20% of Africa’s $100 billion remittance market, second after Egypt. Despite economic challenges, Nigeria’s remittance market is projected to rebound to a 3% growth in 2024, following a modest 1.3% in 2023, though inflows will remain below pre-pandemic highs. This optimistic projection, initially linked to slowing inflation in high-income Western countries where many Sub-Saharan migrants live, is now tempered by the fact that some of these economies, like the UK, are facing recession, which could reduce migrants’ employment opportunities and earnings. The impact on Nigeria’s remittances will depend on the balance between these counteracting forces and the resilience of the migrant community. 

Importantly, actual remittance inflows are likely double what official figures say—estimated at $30 billion, based on the World Bank’s estimates that informal flows could exceed 50% of formal flows. These inflows are an important lifeline for poor, rural households receiving 50% of inbound remittances into low-