Frequently Asked Questions (FAQ's)

Frequently Asked Questions

What is the full impact of the new policy?

As a package, the new agenda will: * better anchor inflation expectations, * strengthen public confidence in the Naira, * make for easier conversion to other major currencies, * reverse tendency for currency substitution, * eliminate higher denomination notes with lower purchasing power, * reduce the cost of production, distribution and processing of currency, * promote the usage of coins and thus a more efficient pricing and payments system, * promote the availability of cleaner notes, * deepen the Forex market, * ensure more effective liquidity management and monetary policy, * convertibility of the Naira and hence greater confidence in the national economy and lead to greater inflow of foreign investment * position the Naira to become the ‘Reference currency’ in Africa.

What is the Agric Credit Guarantee Scheme Fund?

It is a scheme managed by Central Bank of Nigeria (CBN). It provides guarantee cover to banks who give loans to the agricultural sector of the economy. This encourages the banks to provide more funding to the farmers. The Scheme has an authorized share capital of N3 billion controlled by the Federal Government (60%) and the CBN (40%)

What is Destination Inspection Scheme (DIS)?

This is a new inspection scheme recently introduced by the Federal Government whereby goods imported into Nigeria will be inspected at the Port of entry (or discharge) in Nigeria.

When did this scheme commence?

January 1, 2006

What are the main differences between destination inspection (DI) and the old preshipment inspection (PSI) schemes?

1. Pre-shipment Inspection (PI): (a) Place of inspection is at the Port of loading in the Country of Supply abroad. (b) Exemption from inspection: A general list of exempted goods was provided by Federal Ministry of Finance (FMF)/Central Bank of Nigeria (CBN). 2. Destination Inspection (DI): (a) Place of inspection is at the Port of discharge in Nigeria. (b) Exemption from instection: Exemption will be on a case-by- case basis as approved by the Minister of Finance.

What is the minimum loan covered under ACGSF?

N20,000.00 (twenty thousand naira) and below without collateral. For amounts higher than N20,000.00, you will need to provide collateral.

Is the ACGSF for only big farmers?

Small farmers have benefited immensely from ACGS. This group of farmers form 90% of the beneficiaries since the inception of the Scheme.

How did Foreign Exchange Reserves Evolved?

Reserves were formally held only in gold, as official gold reserves.But under the Bretton Woods system, the United States pegged the dollar to gold, and allowed convertibility of dollars to gold. This effectively made dollars appear as good as gold.The US government eventually abandoned the gold peg,making the dollar a reserve currency by fiat only.

Will the usual lending rate apply under the ACGSF?

Under the ACGSF, farmers will borrow from lending banks including community banks at market-determined rates.

What if you do not have collateral?

You can still obtain a loan of N20,000.00 and below supported with a personal guarantee from a reputable person in your community or more than N20,000.00 through being a member of Self Help Group or Cooperative Society.

What are the advantages of having collateral under the ACGSF?

It means you can obtain a loan of up to N1.0 million as an individual or up to N10.0 million as a cooperative society or corporate entity.

How long can one’s loan last?

It depends on the gestation period of the agricultural activity you are engaged in.

How many times can I benefit from ACGSF?

As many times as you wish provided you maintained good loan repayment record with your bank.

What is Reserves Management and Why is it Important?

Reserves management is a processthat ensures that adequate official public sector foreign assets are readily available to and controlled by the authorities for meeting a defined range of objectives for a country. This means that a reserve management entity is normally made responsible for the management of reserves and associated risks. Reserves are held to support the following objectives: 1.Support and maintain confidence in the policies for monetary and exchange rate management including the capacity to intervene in support of national currency. 2.limit external vulnerability by maintaining foreign currency liquidity to absorb shocks during times of crisis or when access to borrowing is curtailed and in doing so; 3.provide a level of confidence to markets that a country can meet its external obligations; 4.demonstrate the backing of domestic currency by external assets; 5.assist the government in meeting its foreign exchange needs and external debts obligations; and 6.maintain a reserve for national disasters or emergencies. Sound reserve management practices are important because they can increase a country's overall resilience to shocks.

Are there any changes in the letter of credit (LC) opening process?

Yes. Before an LC can be opened under the DI scheme, the original Form M must have been submitted to the Scanning company who must also accept or reject it within 24 hours. It is only after confirmation of acceptance that the LC can be opened. Thus, Lcs can no longer be opened with faxed documents.

Why should I check Naira Notes(Banknotes)?

It's a good idea to check your notes whenever exchanging them with someone. Its especially important to be careful if you are in poor light or cannot see the notes clearly. When checking Naira notes, don't rely on just one feature but check a few of the ones described in the "Currency Management" part of this website. Feel the note in your hands and look at it closely. If you have any doubts, compare it to one that you know is genuine.

How do I tell the difference between a counterfeit and a genuine Naira note?

Each Naira note has its own special print features that deterres counterfeiters from creating one. These features range from those we can see with our eyes, feel with your hands, and those that reflect or illuminate under varying light conditions. These features and more are all described in the Currency Management section of this website.

What is the Manufacturer's Certificate of Production under Destination Inspection scheme and will a beneficiary who is a trader be required to submit this document?

The Manufacturer Certificate of Production (MCP) is a document that states the standards to which the goods being imported were produced. Examples of standards are Nigeria Industrial Standards (NIS), British Standards, ISO,IES, DIN, PD etc.

What is the Risk Assessment Report (RAR) under Destination Inspection scheme and what will it be used for?

The Risk Assessment Report (RAR) is a document generated by the scanning company and it evaluates the level of risk associated with an import transction. Some of the factors that are considered before generating the RAR include: (i) Antecedent of the importer (ii) Antecedent of the exporter (iii) Types of goods (iv) Country of supply etc. The RAR determines the level of intervention via inspection that will be required for the Nigeria Custom Services (NCS)

Which document replaces the Clean Report of Inspection (CRI)?

None. Importers are now to do self-assessment of import duty based on the RAR and then proceed to the Verification & Query Seat at the relevant Port for confirmation of correctness. Where the assessed duty is correct, an Assessment Notice is printed so that the importer can proceed to the bank to pay duties and taxes.

If you did not find an answer to your question above, try the Glossary of Terms, or use the form below - ask your question, and we will post it here.

Facts : 1/1/1969

PHYSICAL EXPANSION:Kaduna Branch was opened.

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Frequently Asked Questions

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