Nigeria’s removal from the Financial Action Task Force (FATF) grey list marks a significant milestone and is considered a global vote of confidence in the country’s financial reforms, the Central Bank of Nigeria (CBN) has affirmed. The delisting came after a successful on-site evaluation by the FATF which confirmed Nigeria’s substantial improvements in its anti-money laundering (AML), counter-terrorist financing (CFT), and financial regulatory frameworks. This development is part of a comprehensive two-year reform programme led by the Nigerian government, involving critical agencies such as the CBN, the Federal Ministry of Justice, the Nigerian Financial Intelligence Unit (NFIU), and the Economic and Financial Crimes Commission (EFCC).
Background and Context of FATF Grey Listing
Nigeria was placed on the FATF grey list in February 2021 due to strategic deficiencies identified in its framework for combating money laundering, terrorist financing, and related financial crimes. Being on the grey list subjected Nigeria to increased monitoring and imposed reputational and operational challenges on its financial sector. This listing raised costs for cross-border transactions, limited international banking relationships, and deterred investors by increasing perceived risks in engaging with Nigerian financial institutions. The country’s exit from the list in October 2025 is thus seen as a reversal of those challenges and a restoration of international confidence.
Key Reforms Leading to FATF Exit
The CBN highlighted that the country’s reform efforts were coordinated under the Federal Government’s two-year programme focused on enhancing the transparency, supervision, and governance of the financial sector. The apex bank stated that it played a central role in these reforms by strengthening oversight of banks, fintech firms, and remittance platforms through updated AML/CFT regulations and risk-based supervisory frameworks.
Important measures included:
- Enhanced regulatory frameworks with updated AML/CFT regulations.
- Expanded compliance monitoring across remittance channels, bureaux de change, and fintech operators to boost traceability and reduce illicit financial flows.
- Introduction of the Foreign Exchange Code and the Electronic Foreign Exchange Matching System, designed to increase market transparency and address manipulation risks.
- Improved inter-agency collaboration and data sharing among the CBN, NFIU, EFCC, and law enforcement agencies to coordinate enforcement actions effectively.
These reforms were scrutinized rigorously by the FATF and regional bodies like the Inter-Governmental Action Group Against Money Laundering in West Africa, which confirmed Nigeria’s significant progress.
Statements from the Central Bank of Nigeria
In a statement signed by the Acting Director of Corporate Communications, Hakama Sidi Ali, the CBN noted that the FATF decision was a recognition of Nigeria’s hard work in reforming its financial system. The CBN emphasized the role of all stakeholders in the reform process and acknowledged the collective efforts of financial institutions, regulatory agencies, and the Federal Government in driving compliance with global financial integrity standards.
CBN Governor Olayemi Cardoso described the FATF’s decision as a strong affirmation of Nigeria’s reform direction and growing financial system integrity. He noted, “The FATF’s decision to remove Nigeria from the grey list is a strong affirmation of our reform trajectory and the growing integrity of our financial system. It reflects coordinated efforts of key national institutions working together to deliver sustainable, standards-based reforms.” Cardoso further stressed the priority of consolidating these gains by balancing compliance, innovation, and trust within the financial sector.
Economic Benefits of FATF Exit
The CBN identified multiple economic benefits expected to arise from Nigeria’s FATF delisting, including:
- Restored confidence for international and domestic businesses leading to fewer restrictions in international transactions.
- Enhanced correspondent banking relationships for Nigerian banks, which would facilitate smoother cross-border financial flows.
- Reduction in compliance costs for Nigerian firms operating internationally.
- Improved access to international finance, enabling faster and cheaper cross-border payments.
- Support for trade, increased remittance inflows, and greater foreign exchange stability.
These benefits are anticipated to spur economic growth and deepen Nigeria’s integration into the global financial system.
Broader Industry and Regulatory Reactions
Other regulatory bodies like the Securities and Exchange Commission (SEC) noted that Nigeria’s removal from the FATF grey list would bolster investor confidence and attract foreign capital inflows into the country’s financial markets. SEC’s Director General, Dr. Emomotimi Agama, highlighted that delisting would enhance Nigeria’s international standing and improve its investment risk profile, dismantling a reputational barrier that limited institutional investor participation.
Government officials also reaffirmed their commitment to sustaining progress. The Honourable Minister of State for Finance, Dr. Doris Uzoka-Anite, reiterated the federal government’s dedication to maintaining high standards of transparency and cooperation in combating financial crimes as part of the “Renewed Hope Agenda” under President Bola Ahmed Tinubu’s administration.
Conclusion
Nigeria’s exit from the FATF grey list is a critical endorsement of the country’s financial reforms and anti-money laundering efforts. It signals a turnaround in the country’s global financial standing and creates a more conducive environment for investment, trade, and economic development. The coordinated steps taken by national institutions to upgrade regulatory frameworks, strengthen enforcement, and adopt modern technological solutions have been pivotal in this achievement. Going forward, the challenge remains to sustain these gains and further enhance compliance while fostering innovation and trust within Nigeria’s financial system.
This development is expected to have a far-reaching impact on the Nigerian economy by attracting greater foreign investment, improving financial sector stability, and reinforcing the country’s commitment to international financial standards. Through these reforms and ongoing vigilance, Nigeria aims to ensure its financial system’s resilience and integrity in the face of evolving global risks.