The House of Representatives on Thursday threw its weight behind a bill seeking to prohibit the use of foreign currency for domestic transactions and amend major sections of the Central Bank of Nigeria (CBN) Act.
The bill, jointly sponsored by House Leader Julius Ihonvbere (APC, Edo) and Jesse Onuakalusi (APC, Lagos), aims to overhaul the operational framework of the apex bank, enhance transparency and reinforce institutional checks and balances.
During debate on the general principles of the bill, lawmakers cited Nigeria’s volatile economic climate, unstable exchange rate and concerns over monetary policy execution as justification for the proposed amendments.
They argued that the current Act no longer reflects the demands of a modern financial system.
Leading the debate, Onuakalusi said recent domestic and global economic pressures had revealed shortcomings in the existing legislation.
According to him, the CBN plays a profoundly central role in stabilising the financial system, managing the currency and maintaining confidence among investors and the public.
But he noted that governance lapses witnessed in recent years, ranging from inconsistent policy communication to controversies over foreign-exchange management, exposed structural weaknesses that must be addressed.
“In recent years, ranging from government-concerned foreign exchange destruction, moral policy inconsistency, weak oversight mechanisms, to challenge witnesses around currency redesign and policy communication has exposed a structural gap in the Principal Act,” he said.
Onuakalusi explained that the bill seeks a clear separation of roles between the CBN Governor and the board chairman to prevent an undue concentration of authority.
He added that the legislation introduces a single, non-renewable six-year tenure for the Governor and other key management officials to reduce political interference and promote stability.
“The proposed amendments seek to separate the role of Governor and the Board of Directors, Chairman, to avoid concentration of powers and ensure professional oversight.
“The second aspect this bill helps to ensure is to introduce a single six-year non-renewable 10-year contract, which is a very important part of the CBN Act,” he said.
The legislation also proposes a uniform exchange-rate framework and formally bans the use of foreign currency for local transactions except in regulated or authorised conditions.
Onuakalusi said this measure is intended to curb the widespread dollarisation of the economy and reinforce confidence in the naira.
The bill also strengthens financial-stability oversight by equipping the CBN with clearer prudential tools, better-defined responsibilities and improved mechanisms for responding to systemic risks.
Contributing to the debate, Alhassan Ado-Doguwa, drew lessons from the controversial naira redesign carried out under former President Muhammadu Buhari.
He said the experience demonstrated the dangers of major monetary decisions taken without structured legislative involvement.
According to him, the redesign policy inflicted hardship nationwide and appeared to have been championed by policy actors rather than the president himself.
“I have not seen where the bill is targeting or intending to strengthen or empower an individual. It is, of course, an institutional bill,” he said.
“Suddenly, overnight, the policy makers… it was like a connivance. They suddenly came up with what they call the Naira redesign, pushing the government to take a policy that was apparently not a popular policy at a time when the nation was facing an election process.”
He insisted that any future redesign of the naira or major currency adjustments must be subject to legislative approval, adding that the proposed mandatory 90-day public-notice period would protect citizens.
“The intention to redesign the naira then was not a good one. It was in bad faith,” he said.
According to him, the new bill “returns power to the people” by ensuring the National Assembly fully participates in significant currency-related decisions.
After extensive debate, the bill was passed through second reading following an overwhelming voice vote.
Deputy Speaker Benjamin Kalu, who presided over the session, referred it to the House Committee on Banking Regulations for further legislative work.
The committee is expected to engage stakeholders, review the provisions and present its report to the House at the next stage.
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