A domiciliary account is an account designed to receive foreign currencies such as the US dollar, Pounds Sterling, EUR, among others. It allows individuals, businesses, and corporate organizations to receive and make payments in foreign currencies.
Some of the banks with the best services in terms of domiciliary account include Standard Chartered Bank, Providus, GTBank, First City Monument Bank (FCMB), Zenith Bank, Access Bank
Types
- Personal Use (e.g., online buyers, bloggers)
- Business Use (e.g., importers, exporters)
- Forex Trading (e.g., licensed Bureau De Change operators)
How Dom Account is Operated in Nigeria
For importers and exporters, content creators who have foreign clients, and Google. Dom account enables them to receive international payments seamlessly.
According to a CBN circular dated November 30, 2020, domiciliary accounts will function as follows:
- Used for deposit inflows from exports.
- Restricted to business operations.
- Excess funds will be sold in the Investors & Exporters (I&E) Window.
- Exporters cannot sell foreign proceeds in the black market.
- Funds can be used for eligible electronic transactions.
- Foreign transfers can be used for payments or transfers at any time.
- A cash deposit limit of $10,000 applies.
Benefits of a Domiciliary Account
- Enables transactions in foreign currencies
- Facilitates direct receipt of foreign currency from customers abroad.
- Allows payments for international transactions, particularly for importers.
- Provides more control over naira fluctuations.
- Can be used to stand as a referee for another person.
Factors to Consider Before Setting Up a Domiciliary Account
1) Accessibility: How easy is it to access your account?
Do you need insider connections to operate smoothly?
Does the bank frequently experience foreign currency shortages?
Ask trusted contacts about their experience with different banks.
Security: Does the bank provide timely security updates?
Are your online transactions safe from fraud?
Take personal security precautions, especially when using banking apps.
2) Customer Service: How responsive is the bank’s customer service?
In case of urgent issues, can you reach support easily?
Some banks, such as GTBank, have seen declining service quality probably because of operational challenges.
3) Monthly Charges: Are there hidden maintenance fees?
How much is charged for using debit or credit cards linked to your domiciliary account?
4) Fees per Transaction: How much does it cost to transfer $600 to another domiciliary account?
GTBank and Access Bank charge around $3 per $600 transfer, which is relatively low.
Charges vary by bank, so compare before opening an account.
5) Transaction Limit: The CBN monitors all foreign inflows to prevent illegal activities.
The current transaction limit for a domiciliary account in Nigeria is $10,000 or its equivalent.
6) Intuitive Banking App: Does the bank provide a functional and user-friendly banking app?
Can you complete all essential transactions via the app?
7) Transfer Restrictions: CBN regulations may limit direct transfers between domiciliary accounts.
Some banks, like GTBank, only allow transfers between GTBank domiciliary accounts.
Requirements to Open a Domiciliary Account
Each bank has its requirements, but some general requirements and documents to open include:
- A letter stating the purpose of the account.
- An initial deposit of at least $100 USD (if it is Access bank)
- No initial deposit is required to open dorm account with GTBank
- Two referees
- Valid means of identification such as Driver’s licence, NIN, International Passport, Voter’s card
- Utility bill for address verification.
- To open this account with any Nigerian bank, you need to first have a savings account with them
Upgrade to a current account.
Select the preferred foreign currency.
For specific requirements, contact your preferred bank.
When To Start Using Your Domiciliary Account
Once your bank provides your account details, you can start receiving funds from international clients and making foreign currency transactions.
For example:
Google AdSense Payments: Add your domiciliary account details to your AdSense dashboard for wire transfers.
Receiving Payments from Abroad: Share your account details with international partners.
Currency Exchange: Withdraw funds and exchange them at a Bureau De Change.
Limitations
Transfers between domiciliary accounts are subject to CBN regulations.
Previously, users could wire funds from a domiciliary account and receive naira in return, but this has changed.
Some banks only allow internal transfers (e.g., GTBank domiciliary accounts can only transfer to another GTBank domiciliary account).
Can You Receive Money in Your Domiciliary Account from Russia?
Yes, as long as the transaction is legitimate and within the allowed limits.
By considering the factors above, you can choose the best domiciliary account for your needs and ensure seamless international transactions.