COMPUTERIZATION OF NIGERIA FOREIGN EXCHANGE

Undergraduate

ABSTRACT

This project embarked on the computerization of foreign exchange transaction. According to investigation, it was discovered that the transaction processing are faced with many problems due to the manual method and from the head office. This project looked and solved these problems facing foreign exchange department of my case study.

INTRODUCTION

The Foreign Exchange is a means by which the worth of country can be measured.

The failure of any country to effectively match its input with export would surely create unhealthy balance of payment (B.O.P) it its important exceeds its export in other words, a country should be more export oriented to be able to maintain a surplus balance of payment to evidence economic development. In Nigeria for example, besides earnings from experts, other ways by which it receives foreign currencies into its account are through payment by individual company in Nigeria for personal or business rendered.

The ultimate aim of foreign exchange is either to discourage or encourage importation. This is one to promote the economic situation of the country. If a country wants to encourage importation, the country will increase the strength of her currency and if otherwise the country will decrease the strength of her currency.

There is country in the world today that is self sufficient in the production of all the items it needs for her sufficiency’s, hence the need for international trade. The purchase of commodities from other countries cannot be effected without the country possessing enough foreign currency reserve and payment for each commodity should be effected with the type of currency that is acceptable to both parties. (i.e the buyer and the seller).

EVOLUTION OF FOREIGN EXCHANGE MARKET

The Foreign Exchange market consists of the sellers of foreign exchange (seller) and buyers of foreign exchange (demand). The participants in the foreign exchange market are authorized dealers (banks), the public sectors, the private sectors and correspondent banks abroad.

The supply of foreign exchange is derived from oil exports, non-oil experts, capital receipts including draw-down on loans, expenditure of foreign tourist in Nigeria, repatriation of capital by Nigeria resident abroad and other invisible receipts by the private sectors. On the other hand, the demand of foreign exchange reflects payment for imports; external debt services obligations and financial commitments to international organizations.

The evolution of the foreign exchange market in Nigeria up to its present state was influenced by a number of factors, which include the changing pattern of international trade, institutional change in the economy and structural stuffs in production.

The exchange central system was unable to evolve an appropriate mechanism for foreign exchange allocation in consonance with the goals of internal balance. This lead to the introduction of the second tier foreign exchange market (SFEM) in September, 1986 under SFEM, the determination of the Nigeria exchange rate and allocation of foreign exchange were based on market forces. To enlarge the scope of the foreign exchange market, burese de change were introduced in 1989 for in privately sourced foreign exchange. The bank introduced a pro-rate systems for foreign exchange allocation in February 1993 to ensure that all participant banks got some allocations for foreign exchange. Although, the official exchange rate for the naira was stabilized administratively, the rates in the other segments of the market remained instable/unstable

 

AIMS AND OBJECTIVES OF THE STUDY

The main objective of the proposed system (i.e computerizing the exchange service system) is it over the setbacks and problems encountered in the manual method.

The aims and objectives are as follows:

1.      It examines the benefits of computer in computerization of the foreign exchange transaction.

2.      it knows the conversation from one currency to another with the use of computers .

3.      It speed up the efficiency of the organization (i.e) in foreign transaction matter.

4.      It eradicate the problems and stressed that are involved with manual processing.

5.      It allow large number of customers to be attended to within a short period of time.

6.      It also examines the extent to which commuter can simplify te foreign exchange operation.

7.      It calculates and determines the currency worth of are country to another with use of computer.