The Central Bank of Nigeria (CBN) has issued new pointers allowing Bureau de Change (BDC) operators to buy as much as $25,000 weekly from Authorised Vendor Banks (ADBs) to fulfill retail market demand for eligible invisible transactions.
The directive, contained in a round from the Commerce and Change Division, additionally outlines compliance necessities to make sure transparency and curb potential foreign exchange misuse.
Dated February 5, 2025, the round was signed by Dr. W. J. Kanya, the Performing Director of the Commerce & Change Division on the CBN.
BDCs restricted to 1 vendor per week
Beneath the brand new laws, BDCs should supply the allotted foreign exchange from a single authorised vendor bank per week. This restriction is aimed toward stopping speculative exercise and making certain higher oversight. Any BDC discovered violating this rule will face acceptable sanctions from the CBN.
Additionally, authorised sellers should promote FX to BDCs on the prevailing charge within the Nigerian International Change Market (NFEM) window to make sure consistency in pricing.
Foreign exchange gross sales to end-users capped at 1% margin
The CBN has imposed a 1% cap on the margin BDCs can cost end-users above their buy worth. This measure is designed to guard shoppers from extreme costs and promote a fairer foreign exchange market.
Additionally, the one per cent margin applies to all foreign exchange bought by BDCs, no matter its supply.
Obligatory reporting for sellers and BDCs
To boost market transparency, the CBN has made reporting necessities necessary for each Authorised Vendor Banks and BDCs:
- Authorised sellers should submit weekly stories of their foreign exchange gross sales to BDCs in a specified Excel format to the CBN Commerce and Change Division through [email protected].
- BDCs should render each day returns on foreign exchange purchases and gross sales (utilisation) via the Monetary Establishments Foreign exchange Reporting System (FIFX).
These measures will assist the CBN monitor foreign exchange flows and forestall illicit actions within the foreign money market.
Most $5,000 per disbursement
The round additionally specifies that BDCs can solely disburse bought FX for particular transactions, with a most of $5,000 per transaction, quarterly. These embrace:
- Enterprise Journey Allowance (BTA) / Private Journey Allowance (PTA)
- Abroad college charges
- Abroad medical charges
Strengthened anti-money laundering measures
As a part of efforts to fight monetary crimes, the CBN has directed BDCs to take care of correct information of all transactions. This contains:
- Bank Verification Quantity (BVN) of end-users
- Endorsement of the quantity disbursed within the beneficiary’s worldwide passport
The CBN additionally reiterated that each one operators should comply strictly with Anti-Cash Laundering (AML) legal guidelines and Know Your Buyer (KYC) necessities to forestall fraud and illicit monetary actions.
Sanctions for non-compliance
The apex bank has warned that any Authorised Vendor Bank or BDC that violates these pointers—together with foreign exchange diversion—will face extreme sanctions, together with the suspension of their dealership license.
The CBN’s transfer to permit BDCs entry to foreign exchange purchases from authorised sellers is seen as a part of broader efforts to enhance liquidity within the foreign exchange market and guarantee reliable retail demand is met. The apex bank continues to implement measures to stabilise the naira and curb speculative actions.
What you must know
- Nairametrics earlier reported that the CBN prolonged the deadline for Bureau de Change (BDC) operators to entry the Nigerian International Change Market (NFEM) for weekly FX purchases.
- In a round signed by Dr. W.J. Kanya, the Performing Director of the Commerce & Change Division on the CBN on Monday, the apex bank introduced that the earlier deadline of January 31, 2025, has now been prolonged to Could 30, 2025.
- The extension is predicted to offer BDC operators with continued entry to FX, doubtlessly stabilizing the parallel market and enhancing liquidity. It additionally alerts the CBN’s sustained intervention in managing foreign exchange provide whereas retaining its regulatory oversight intact.
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