If you transact business abroad from home that requires you to use foreign currency or you are finding it hard to send and receive foreign currencies such as Pounds, Dollars, Euros, etc, then you would need to open a domiciliary account to do such transactions.
You need to have a domiciliary account in Nigeria if you are the type that does foreign currency transactions from any country. With this account, you can operate from the comfort of your office, home, etc any where in Nigeria. If you want to fund your account, just give the sender your dorm account number and SWIFT BIC CODE (this can be gotten from the bank or online).
You can also link your domiciliary account to the website you are using to receive foreign currencies and it will enter within 2 to 5 business working days. International business transactions are normally influenced by exchange rates. If you want to withdraw a foreign currency and convert your money to Nigerian Naira (₦), you should be aware that banks offer such service but will offer you in CBN exchange rate which fluctuates on a daily basis, according to economic conditions in the world market.
Just like other types of accounts in Nigeria, savings and current account respectively, you can request for a Dollar credit or debit card to carry out transactions online via internet banking, pay, request and receive payments from websites offering such services. With this ATM card, you don’t need to visit any bank unless you wish to withdraw or change the currency. Depending on the bank you use, note that your domiciliary account debit card has its own charges.
WHAT IS A DOMICILIARY ACCOUNT?
A domiciliary account is an account that is functionally used to make transactions in a foreign currency. The major currencies that Nigerians open domiciliary accounts for are the dollar, euros and pounds sterling. There are a lot of benefits that can be accrued just for having a domiciliary account. You can receive or even send money across various banks in the world. In the course of this article, we would be looking at how you can open a dom account in Nigeria.
Domiciliary accounts have two broad categories. We have current domiciliary accounts, and savings domiciliary accounts. They both have their own distinctive features. For instance, with a current domiciliary account, you can withdrawals, write cheques, cash in cheques and make cash deposits in any foreign bank that the currency is functional in. This type of domiciliary account is mainly operated by business individuals. For the savings dom account, you can’t use cheques, but you can do anything other types of the financial transaction. This is the major distinction between the two account types.
Also note that exchange rates do not affect the money within your account. This post will show you the procedure on how to open a domiciliary account easily in Nigeria in 2023.
STEPS FOR OPENING A DOMICILIARY ACCOUNT IN NIGERIA
Here is how to go about it.
STEP 1: COLLECT DOMICILIARY ACCOUNT FORM FROM ANY NIGERIAN BANK
Visit any bank that provides such type of account service and request for the domiciliary account opening form.
STEP 2: FILLING OF FORM
Fill the form with your personal details and submit the following for valid identification:
- National ID, drivers license, International passport, voters card or whatever the bank requests of you. This is used to verify your name.
- A copy of your electricity bill or water bill. This bill must have the same address you used in filling the domiciliary form as it will be used by the bank for address verification.
- Depending on the bank, you should be required to produce one or two reference letter from a current account holder or a previous domiciliary account holder.
- 2 (two) current passport photographs.
Note: If you have a current account in any other bank or with the bank you chose to open the domiciliary account, some of the requirements above might be skipped. The bank might require you to open either a savings or current account if you have none with them to use alongside your domiciliary account.
STEP 3: MEET BANK REQUIREMENTS AND SUBMIT FORM
After meeting the requirements and filling the form, you would be required to make an initial deposit of one hundred US Dollars (varies according to bank). You may as well withdraw the money when you account is active.
STEP 4: COLLECT YOUR DOMICILIARY ACCOUNT DETAILS
Finally, within a period of 48-72 hours, you should receive your domiciliary account details.
STEP 5: FUND ACCOUNT AND REQUEST FOR A DOMICILIARY DEBIT/CREDIT CARD
After the account has been opened, fund it with the foreign currency that you selected. You would now request the debit/credit master card you would use for your international transactions.
In Nigeria, there is no singular platform that allows for the opening of domiciliary accounts. Rather, there are banks that have clearance by the CBN to allow Nigerians to open dom accounts.
HOW MUCH DOES IT COST TO OPEN A DOMICILIARY ACCOUNT IN NIGERIA?
The cost of opening a domiciliary account in Nigeria is usually free, depending on the bank and the type of domiciliary account you want to open. Although, you are expected to fund the account as soon as possible. There are also certain charges such as $10 maintenance fee which is collected on a yearly basis and 0.5% of any amount withdrawn over the counter.
HOW DO I OPERATE A DOM ACCOUNT
In order for you to operate a fully functional Domicialary account, you have to open one in any of the local banks in Nigeria. Some of these banks include; Ecobank, First Bank of Nigeria, United Bank of Nigeria, Zenith Bank, Wema Bank, Sterling Bank, Fidelity Bank, GTBank, Stanbic Bank PLC etc. These aforementioned banks offer very nice and friendly domiciliary account policies. If you do a wire transfer, it will take a minimum of three working days to complete the transaction. Domiciliary accounts also have cards which can be used to withdraw funds.
Dom accounts asides from giving you the exclusive ability to make foreign transactions, you can also save with them. You can choose to have a dollar account for the sole purpose of savings. For instance, If you are afraid of the fleeting rise and fall of the value of the Naira currency, you can decide to save in dollars for future purpose. At least, after some time you would be expecting an increased value in your base currency.
As there are many advantages accrued to opening a domiciliary account, there are also disadvantages attached to the same cause. One of such disadvantages is the difficulty involved in getting a guarantor for your account opening. You must have a referee or guarantor before you are allowed to open a domiciliary account.
Another con is that transactions performed in local Nigerian banks accrue a lot of charges. Thanks to the Intervention of the Central bank of Nigeria and their reformed policies, you can open a Dom account with an amount ranging from $50 and $100. Also, the new cost for renewing and maintaining your Nigerian domiciliary account is just $10.
You can also open a domiciliary account online from the comfort of your home. Just call any Nigerian bank customer care number and request that the form be sent to you. They would also guide you on what to do to make opening a domiciliary account with them possible.
Virtually all banks in Nigeria offer such account service, but GTBank, FCMB and Zenith Bank are the best. Please read this guide on things to note before applying for a dorm account in Nigeria in 2023.