The Central Bank of Nigeria (CBN) has revoked the licences of 4,173 Bureaux De Change Operators over their failure to meet regulatory guidelines.
The bank disclosed this in a statement signed by the acting Director, Corporate Communications, Sidi Hakama, on Friday.
Sidi said the licence withdrawal is in exercise of the powers conferred on the apex bank under the Bank and Other Financial Institutions Act 2020, Act No. 5, and the Revised Operational Guidelines for Bureaux De Change 2015.
The statement, “The Central Bank of Nigeria, in exercise of the powers conferred on it under the Bank and Other Financial Institutions Act 2020, Act No. 5, and the Revised Operational Guidelines for Bureaux De Change 2015, has revoked the licences of 4,173 Bureaux De Change Operators.
“The list of affected BDC operators is available on the Bank’s website (www.cbn.gov.ng).”
It added that the affected institutions failed to observe at least one of the regulatory provisions.
According to the statement, the regulation include payment of all necessary fees, including licence renewal, within the stipulated period.
It added, “The affected institutions failed to observe at least one of the following regulatory provisions: Payment of all necessary fees, including licence renewal, within the stipulated period in line with the Guidelines.
“Rendition of returns in line with the Guidelines. Compliance with guidelines, directives and circulars of the CBN, particularly Anti-Money Laundering, Countering the Financing of Terrorism and Counter-Proliferation Financing regulations.”
The director further stated that, “The CBN is revising the regulatory and supervisory guidelines for Bureau de Change operations in Nigeria. Compliance with the new requirements will be mandatory for all stakeholders in the sector when the revised guidelines become effective.
“Members of the public are hereby advised to take note and be guided accordingly.”
Last Tuesday, the Central Bank of Nigeria announced its decision to sell foreign exchange worth $20,000 to each eligible Bureau De Change operator across the country.
This is coming more than two years after the suspended former CBN governor, Godwin Emefiele, stopped the sales of foreign exchange to BDC operators in that segment of the forex market.
The apex bank disclosed this in a new circular issued and signed by the Director, Trade and Exchange Department, Hassan Mahmud, on Tuesday.
The circular titled, “Sale of Foreign Exchange to Bureau de Change Operators to meet retail demand for eligible invisible transactions” said the move aimed at rectifying the persisting distortions in the retail segment of Nigeria’s foreign exchange market and bridging the widening gap in the exchange rate.
It said the allocation will be sold at a rate of N1,301/$, reflecting the lower band rate of executed spot transactions at the Nigerian Autonomous Foreign Exchange Market as of the previous trading day, dated February 27, 2024.
The circular read, “Following the ongoing reforms in the foreign exchange market, aimed at achieving an appropriate market-determined exchange rate for the Naira, the Central Bank of Nigeria has observed the continued price distortions at the retail end of the market, which is feeding into the parallel market and further widening the exchange rate premium.
“To this end, the CBN has approved the sale of foreign exchange to eligible Bureau De Change to meet the demand for invisible transactions. The sum of $20,000 is to be sold to each BDC at the rate of N1,301/$- (representing the lower band rate of executed spot transactions at NAFEM for the previous trading day, as of today, 27th February 2024).
“All BDCs are allowed to sell to end-users at a margin NOT MORE THAN one per cent (1 per cent) above the purchase rate from CBN.”
It further directed eligible BDCs to make Naira payments to the designated CBN Foreign Currency Deposit Naira Accounts and submit confirmation of payment, with other necessary documentation.
“All eligible BDCs are directed to make the Naira payment to the designated CBN Foreign Currency Deposit Naira Accounts and submit confirmation of payment, with other necessary documentation, for disbursement at the appropriate CBN Branches ABUJA, AWKA, LAGOS and KANO,” it added.
The CBN in frantic efforts to save the free fall of the naira has made a number of significant reforms towards addressing Naira depreciation, such as probing and clearing FX backlog, limiting forex for foreign education and medical tourism, increasing BDCs’ minimum share capital, and curbing FX speculators, among others.
