Stanbic IBTC Bank has launched a cross-border payment platform that allows Nigerian businesses to initiate payments in naira and settle transactions in Chinese yuan. The platform was unveiled in Lagos. It connects customers to China’s Cross-border Interbank Payment System (CIPS) through Standard Bank Group, a direct participant. Stanbic IBTC Chief Executive Wole Adeniyi said the initiative would reduce reliance on intermediary banks, lower transaction costs and improve trade settlement efficiency.
The bank said CIPS could process payments within 24 hours, compared with 48 to 72 hours through conventional channels. The Central Bank of Nigeria welcomed the initiative, describing it as supportive of trade facilitation and currency diversification. The platform targets importers, manufacturers and businesses trading with China. China is one of Nigeria’s largest import sources. Many Nigerian traders buy machinery, electronics, textiles and raw materials from Chinese suppliers. Dollar intermediation has been a persistent cost.
The mechanics matter. Most Nigeria-China trade settles in dollars. That requires converting naira to dollars, then dollars to yuan. Each conversion adds cost and delay. A direct naira-to-yuan channel could reduce both. It also reduces demand for dollars in trade settlement, which could ease pressure on the naira. The 24-hour settlement window is a significant improvement over 48 to 72 hours. For an importer waiting for goods to clear, faster settlement means lower demurrage and better cash flow.
The historical echo is the 2018 currency swap agreement between Nigeria and China. That deal was meant to reduce dollar dependence in bilateral trade. It was slow to take off because banks lacked direct settlement channels. The Stanbic platform is a private-sector solution to a problem that government agreements struggled to solve. The winners are importers, manufacturers and Stanbic IBTC, which gains a new product. The losers are intermediary banks that profit from dollar conversions, and the parallel market, which loses some trade settlement volume.
Winners: Importers and manufacturers trading with China; Stanbic IBTC; the CBN, which gains currency diversification.
Losers: Intermediary banks that profit from dollar conversions; the parallel market, which loses some settlement volume.
Bottom Line: A direct naira-to-yuan channel is a practical step. It will not solve Nigeria’s trade imbalance with China, but it can lower costs for the businesses that drive imports.