The Association of Bureau De Change Operators of Nigeria (ABCON) has sent a strong worded letter to the Central Bank of Nigeria (CBN) accusing the regulator of over-regulating the sector.
ABCON National President Alhaji Aminu Gwadabe said the increasing challenges arising from over regulation and complex documentation requirements that licensed BDC operators face in their daily legitimate operation are worrisome.
These, he said, have had negative impact on their efforts toward compliance to statutory and regulatory requirements.
The ABCON chief said that six units within the CBN are involved with BDC regulations, supervision, licensing, monitoring and this, he noted constitutes multiple regulation of a unit of the financial sub-sector that is only a small market player.
“A BDC operator is expected to render daily, monthly, quarterly, half yearly and annual returns to these various departments of the same corporate body, which could be very cumbersome, repetitive and time consuming for both the operator and the regulator.
“In addition to the above mentioned reports, the BDC is also under obligation to render same returns to the Economic and Financial Crimes Commission /Nigeria Financial Intelligence Unit, while at the same time reporting to other statutory government establishments as the Federal Inland Revenue Service and Corporate Affairs Commission respectively,” he said.
Gwadabe also said that the BDCs have in recent times come under severe pressure from the CBN for observed infractions. “Unfortunately, some have had to pay high penalties to different departments where instant regulations were violated. The result of these penalties is a heavy burden on the BDCs considering the little margin of profit allowed on their transactions,” he said.
The CAC, he added, has also hiked their incorporation fees and with the review of the operational requirements, which made it mandatory for every BDC operator to recapitalise the initial capital and upgrade the documentation with the CAC. The BDCs were charged enormously for the perfecting of their documents.
The ABCON boss also said operators had to grapple with the problem of erratic network at the electronic Financial Analysis and Surveillance System (e-FASS) platform around the country in the last couple of months. This situation, he said, hampered the rendition of BDC returns to the CBN by operators and eventually many were recently penalised as a result.
He said the documentation requirement to process a Personal Travelling Allowance of say $10,000 requires an international passport, valid visa, ticket among others, making the process cumbersome, complex and inconvenient for both the buyer and the BDC operator. Also, payment for medical fees of say $3,000 requires hospital bill, international passport, ticket, valid visa among others, to consummate the transaction.
Gwadabe faulted the inability of the regulators, statutory agencies to effectively monitor, supervise, train the ever-growing number of the BDCs as a result of these multiple and overlapping regulations by the various departments of the CBN and other related agencies.
He said: “The CBN should consider the introduction of dollar denominated cards and coupons to BDCs for retailing to the public. We shall welcome your invitation at your convenience to shed more light on this. We suggest a single BDC directorate at the CBN to be in charge of the BDC sub-sector in order to enhance efficiency, productivity and transparency. This would engender proactive involvement of both the regulators and the BDCs for the growth and dynamism of the sector,” he said.
“The CBN should consider alternative requirement for means of identification such as drivers licence, voters card, and international passport.”
