The Central Bank of Nigeria (CBN) has introduced fresh guidelines for Bureau de Change (BDC) operators, allowing them to buy up to $25,000 per week from a single Authorised Dealer Bank (ADB). The new policy aims to regulate the retail forex market, prevent speculation, and ensure better oversight.
The circular, signed by Dr. W. J. Kanya, Acting Director of the Trade & Exchange Department at the CBN, outlines several compliance measures to promote transparency and curb misuse of foreign exchange. Under the new rules, each BDC must source its forex from just one ADB per week, ensuring tighter control over forex distribution. Any BDC found violating this requirement will face strict penalties from the CBN.
Additionally, authorised dealer banks are required to sell forex to BDCs at the prevailing rate in the Nigerian Foreign Exchange Market (NFEM) window. This is intended to maintain consistent pricing across the forex market. The CBN has also imposed a 1% cap on the margin BDCs can charge end-users above their purchase price. This restriction applies to all forex transactions handled by BDCs, regardless of the source of funds.
To further enhance transparency, the CBN has made it mandatory for both ADBs and BDCs to submit regular reports on their forex transactions.
“Authorised dealers must submit weekly reports of their forex sales to BDCs in a specified Excel format to the CBN Trade and Exchange Department via teddmo@cbn.gov.ng. BDCs must render daily returns on forex purchases and sales (utilisation) through the Financial Institutions Forex Reporting System (FIFX). These measures will help the CBN track forex flows and prevent illicit activities in the currency market,” the CBN explained.
The circular also specifies that BDCs can only sell forex for certain transactions, with a maximum of $5,000 per transaction, per quarter. These approved transactions include Business Travel Allowance (BTA), Personal Travel Allowance (PTA), overseas school fees, and overseas medical bills.
Furthermore, the CBN has warned that any authorised dealer bank or BDC found violating these new rules—such as diverting forex for unauthorised purposes—will face serious penalties, including the suspension of their operating license.
