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Tag: BDCs

  • CBN extends FX market access for BDCs to May 2025

    CBN extends FX market access for BDCs to May 2025

    The Central Bank of Nigeria (CBN) has extended the temporary window that allows Bureau de Change (BDC) operators to purchase foreign exchange (FX) from authorised dealers at the Nigerian Foreign Exchange Market (NFEM).

    Initially set to expire on January 31, 2025, the arrangement will now remain in place until May 30, 2025.

    The decision to extend was communicated to all Bureau De Change Operators via a circular TED/FEM/PUB/FPC/001/003 by the apex bank on Monday.

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    The extension, the CBN said, is to ensure that BDCs can continue purchasing up to $25,000 per week, under the same terms and conditions outlined in the CBN’s earlier directive dated December 19, 2024.

    The extension signals the CBN’s continued efforts to stabilise the FX market and address liquidity challenges.

    The regulator emphasized its commitment to maintaining a fully functional foreign exchange system, noting that it will intervene as needed to manage price volatility.

    According to a previous statement by the CBN on February 24, 2024, BDC operators can also source FX from other channels, including tourists and returnees from the diaspora, expatriates who receive foreign exchange inflows from work, travel, or investment, as well as residents with similar FX inflows through their domiciliary accounts. Other permitted sources include International Money Transfer Operators (IMTOs), embassies, and hotels that are authorized buyers of FX.

  • BDCs reject N2b capital base, seek two-year recap timeline

    BDCs reject N2b capital base, seek two-year recap timeline

    Bureaux De Change operators have rejected Central Bank of Nigeria (CBN’s) new regulatory guidelines that pegged minimum capital base at N2 billion for Tier-1 and N500 million for Tier-2 operators.

    Rising from an emergency hybrid online and physical meeting held yesterday in Lagos, President, Association of Bureaux De Change Operators of Nigeria (ABCON), Dr. Aminu Gwadabe, said the capital requirement set by the CBN is huge and far above global best practices.

    Speaking on the theme: New CBN Regulatory & Supervisory Reforms for BDCs: Challenges and Way Forward, he called for for immediate reversal of the capital base plan to N500 million for Tier-1 BDCs, N100 million for Tier-2 BDCs and N35 million for Tier-3 BDCs.

     “The CBN should allow the existing owners of both the eligible BDCs and revoked BDCs to recapitalise instead of reapplying for new licence. The existing N35 million capital requirements should be recognised and be part of recapitalisation. The CBN should embark on nationwide enlightenment to address the fears of the willing investors,” he stated. 

    The apex bank had last week,  said the new regulatory guidelines for BDCs was  part of reforms to re-position the BDC sub-sector to play its envisioned role in the foreign exchange market in Nigeria.

    It directed that all existing BDCs shall re-apply for a new license according to any of the Tiers or license category of their choice as provided in the guidelines. Also, all operators are to meet the minimum capital requirements for the license category applied for within six months from the effective date of the guidelines.

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     Gwadabe said: “We observed the minimum financial requirements of N2 billion and N500 million for Tier-1 and Tier-2 BDCs respectively is discriminatory and higher than what is obtainable in other jurisdictions.

    In the United Kingdom, the capital base for a BDC is £50,000; Kenya $50,000; India $67,000; Uganda $13,000 among others which are far lower than what has been pegged for Nigeria operators.”

    According to Gwadabe, one per cent transaction margin stipulated in the new guidelines for BDCs is not enough to cover operating costs and overhead for the workforce and making profit from the transactions will be very difficult.

    He said the six months compliance timeline which commences on June 3, is also not sufficient to raise such funds and therefore called for two-year timeline.

     “Even BDC operators with landed properties or other assets for sale to raise the funds, will not be able to accomplish such within the time frame. Other sectors including banks have two years timeline. Such timeline should also be granted to BDCs,” he said.

    He said the planned high capital base could chase genuine BDC operators to the parallel market and worsen the exchange rate.

    “The CBN should avoid the Algerian example where higher capital pushed BDCs to the parallel market and disrupted the country’s exchange rate system,” he said.

    Gwadabe said the timing for compliance should be extended to two years for fairness while grants of indemnity and guarantee to ensure policy consistency.

     “Existing BDCs to be allowed to use their generic names as against registration of a new names at the Corporate Affairs Commission. The terms of engagement for mergers and acquisitions should be properly explained to allow for inclusion. The allocation of 75 per cent to cards and 25 per cent cash in forex transactions should be reversed inversely to encourage smooth take-off,” he stated.

  • N2b capital: BDCs weighing options

    N2b capital: BDCs weighing options

    The recent crash of the naira has prompted the Central Bank of Nigeria (CBN) to issue draft guidelines aimed at regulating Bureau De Change (BDC) operators. However, the guidelines have sparked both debate and intrigue.

    The Central Bank of Nigeria (CBN) is planning to unleash a new regulatory hammer on Bureau De Change (BDC) operators, by introducing stringent guidelines aimed at curbing their activities and bringing greater stability to the foreign exchange market.

    At the heart of the changes lies a staggering 5,628.57 per cent increase in licensing fees. Tier 1 BDCs, previously requiring N35 million, now face a hefty N2 billion hurdle, while Tier 2 operators must cough up N500 million.

    This dramatic shift comes amid a persistent foreign exchange crisis, pushing the Naira to an all-time low against the dollar. The CBN, led by Financial Policy and Regulation Department head Haruna B Mustafa, aims to address concerns about money laundering, speculation, and unfair competition within the BDC sector.

    The new guidelines impose a clear demarcation between BDCs and other financial institutions, prohibiting ownership stakes by banks, government agencies, and NGOs. BDCs’ activities are strictly limited to buying and selling foreign currencies, issuing prepaid cards, and acting as cash-out points for money transfer operators. Gone are the days of taking deposits, granting loans, or dabbling in gold or capital markets (as the draft guidelines suggest).

    Sourcing foreign exchange also faces stricter scrutiny. Authorized dealers, travelers, hotels, and embassies remain permissible sources, but transactions exceeding $10,000 now require a declaration of origin.

    Selling foreign exchange is similarly regulated, with BDCs restricted to approved purposes like travel, medical bills, and school fees, subject to annual customer limits. Notably, 75 per cent of all sales must be conducted electronically, promoting transparency and reducing cash transactions.

    The two-tiered BDC system persists, with Tier 1 operators enjoying national presence and franchise opportunities, while Tier 2 remains limited to one state with a maximum of three locations.

    Compliance measures are paramount. BDCs must verify customer identities, maintain detailed transaction records, connect to the CBN systems, and display clear exchange rates. Regulatory returns are still mandatory, records must be readily available for inspection, and adherence to the guidelines is non-negotiable.

    For Tier 1 BDCs venturing into franchising, specific standards covering policy, monitoring, and branding are outlined. Additionally, prudential requirements set limits on open positions, fixed assets, borrowings, and dividend payments.

    Anti-money laundering and counter-terrorism financing regulations will also be reinforced, demanding robust policies, monitoring, and reporting mechanisms from BDCs.

    These sweeping changes have sparked both applause and apprehension. While some view them as necessary for curbing speculation and enhancing transparency, others worry about the impact on smaller BDCs struggling to meet the increased capital requirements and adapt to stricter regulations.

    The CBN’s crackdown on BDCs, coupled with recent raids by security agencies on suspected illegal operators across the country, underscores the seriousness of the foreign exchange crisis. Whether these new guidelines will effectively stabilize the market and achieve their intended goals remains to be seen. One thing is certain: the BDC landscape in Nigeria is undergoing a significant transformation, with far-reaching consequences for operators and foreign exchange accessibility in the country.

    BDC shake-up: examining CBN’s draft restrictions

    The CBN has proposed draft guidelines for BDC operators, introducing significant restrictions on ownership and activities. While the stated goals aim to enhance transparency, stability, and fairness within the sector, a closer look reveals multifaceted complexities and potential drawbacks.

    The CBN’s primary concern centers around preventing BDCs, if owned by banks or large financial institutions, from inadvertently swaying the official foreign exchange market. This potential for influence, it argues, could disrupt market stability and undermine the integrity of both systems. However, critics counter that this rationale overlooks the potential benefits of increased capital and expertise that established institutions might bring to the BDC sector.

    Another key argument behind the restrictions is fostering a more competitive BDC landscape. Proponents believe that allowing banks to own BDCs creates an unfair advantage, leveraging their resources to dominate the market and potentially squeezing out smaller players. Restricting ownership, they argue, levels the playing field and encourages healthy competition, ultimately benefiting both BDC operators and customers through improved pricing and service.

    The CBN also emphasizes the need for enhanced transparency and regulatory oversight within the BDC sector. By removing entities like Governments at all levels; Non-Governmental Organisations; Cooperative societies; Charitable organisations; Academic and religious institutions; and Telecommunication services providers, all of who possess complex financial structures from ownership, the argument goes, the CBN gains greater clarity and control, potentially reducing opportunities for money laundering and other illicit activities. However, concerns exist that this approach might oversimplify the issue, neglecting the potential for robust compliance measures within even complex structures.

    If implemented effectively, these restrictions could yield positive outcomes. A more stable BDC market, less susceptible to external fluctuations, could lead to predictable foreign exchange rates for individuals and businesses. Additionally, a level playing field with fair competition could benefit both BDC users and operators through improved pricing and service. Strengthened regulatory oversight, if achieved, could enhance compliance and reduce risks within the market.

    However, the proposed restrictions also carry potential drawbacks. Excluding established financial institutions could restrict access to valuable capital and expertise, hindering growth and innovation within the BDC sector. Furthermore, concerns exist that limiting bank involvement could reduce market liquidity, making it harder for individuals and businesses to access foreign exchange. Implementing these restrictions effectively will require robust monitoring systems and clear criteria for identifying prohibited entities, presenting a complex challenge for the CBN.

    BDCs under the microscope: navigating the permitted and prohibited

    The CBN’s new draft guidelines for BDC operators have cast a spotlight on their activities, clearly delineating permitted and prohibited practices. While some might see this as a restrictive exercise, understanding the rationale and implications is crucial for navigating the changing landscape and ensuring BDCs contribute to a stable and transparent financial ecosystem.

    BDCs can procure foreign exchange through authorized channels like tourists, returning Nigerians with forex inflows, and businesses with legitimate forex earnings. This ensures the forex entering the BDC system is legitimate and verifiable. They remain authorized to sell forex for approved purposes like travel, medical expenses, and educational fees, subject to established limits per customer. This caters to the needs of individuals requiring foreign exchange for legitimate purposes.

    The proposed guidelines permit BDCs to maintain accounts with commercial or non-interest banks in both naira and foreign currencies. This facilitates efficient financial transactions and record-keeping, enhancing transparency and accountability. They are welcome to collaborate with banks for issuing prepaid cards that offers customers a convenient and secure way to manage their forex holdings, aligning with the CBN’s drive towards cashless transactions. BDCs can now act as authorized cash-out points for international money transfer operators thus allowing BDCs to play a role in facilitating legitimate cross-border transactions.

    The ban on roadside forex trading aims to curb unregulated activities and potential black market dealings, promoting a more formal and monitored BDC sector. Prohibiting BDCs from holding customer accounts or acting as safekeeping services prevents them from morphing into unofficial banks, ensuring they remain focused on their core function of forex exchange.

    In addition, engaging in activities like taking deposits, granting loans, or offering retail forex to businesses is strictly forbidden. This prevents unfair competition with licensed banks and ensures BDCs operate within their designated role.

    Restrictions on international money transfers, except for authorized cash-out points, aim to curb potential money laundering and ensure BDCs operate within the domestic forex market. Also, prohibiting BDCs from opening foreign accounts, having foreign partners, or conducting business outside Nigeria promotes transparency and regulatory oversight, preventing potential illicit activities outside the CBN’s jurisdiction. BDCs cannot hold onto customer forex for extended periods, requiring them to sell it within stipulated timeframes. This ensures forex circulation and prevents BDCs from hoarding or manipulating the market.

    The guidelines frown at BDCs engaging in risky activities like forwards and futures trading which are strictly prohibited and protects BDCs from potential losses and ensuring they focus on their core forex exchange function. Obtaining foreign currency from unauthorized sources is illegal, ensuring BDCs only deal with legitimate sources and preventing the entry of illicit funds into the system.

    Additional restrictions include BDCs barred from borrowing more than 30 per cent of their shareholder funds, ensuring they operate within prudent financial parameters and preventing excessive debt exposure. Dealing in gold, precious metals, or engaging in capital market activities are off-limits, keeping BDCs focused on their core mandate and preventing them from venturing into unrelated and potentially risky areas.

    When the guidelines become operational, BDCs must strictly adhere to the permitted activities outlined in the guidelines. Any future activities deemed “non-permissible” by the CBN will be prohibited, ensuring the BDC sector operates within a clear regulatory framework. They are prohibited from financing political activities, preventing them from influencing political processes and maintaining their neutrality as financial entities.

    Why the Rules?

    These restrictions are not simply about limiting flexibility, but rather about promoting a BDC sector that is transparent. By clearly defining permitted and prohibited activities, the CBN aims to increase transparency within the sector, making it easier to monitor and prevent illicit activities.

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    Limiting BDCs’ involvement in risky activities and ensuring they operate within defined parameters contributes to a more stable BDC sector, minimizing potential risks to the wider financial system. Restricting BDCs from overstepping their boundaries creates a fairer playing field for both BDCs and licensed banks, ensuring healthy competition and protecting consumer interests. Prohibiting activities like money laundering and unauthorized forex sourcing helps protect the financial system and the Nigerian economy from potential harm.

    While some BDCs might perceive these restrictions as limitations, they are ultimately intended to ensure their long-term sustainability and contribution to a healthy financial ecosystem. By understanding the rationale behind these guidelines and operating within the permitted scope, BDCs can continue to play.

    Expert weighs in

    Dr. Wahab Balogun of Ambosit Capital Managers, representing an informed perspective, acknowledges the risk-reduction potential of the guidelines. He sees limitations on ownership and activity restrictions as beneficial for financial system stability. He applauds the emphasis on customer identification, recordkeeping, and electronic transfers, viewing them as safeguards for both customers and operators. The two-tiered structure finds favour as a way to cater to diverse market needs.

    However, Dr. Balogun shares concerns about the burden on smaller BDCs. He warns that stringent compliance and costs could limit their competitiveness and hinder growth. He also cautions against unintended consequences, such as deterring certain segments of the population from accessing BDC services due to cash transaction limitations and reporting requirements.

  • Travelex, ABCON partner on $20b Diaspora remittances

    TRAVELEX Nigeria and the Association of bureaux De Change Operators of Nigeria (ABCON) have agreed to enter into strategic partnership that would enable the Bureaux de Change (BDCs) access over $20 billion Diaspora remittances into Nigeria annually.

    ABCON President, Aminu Gwadabe, disclosed  this at a one-day sensitisation programme organised for BDCs by Travelex Nigeria and Travelex UK, at the Hilton Hotel, Abuja.

    He said Travelex and ABCON are reviewing the possibility of ABCON riding on the Travelex high-tech for  BDCs to  become direct agents of International Money Transfer Operators (IMTOs).

    He said the digitization of the BDCs operations through the launch of  ABCON Live Run Automation Portal which has the backing of the  Central bank of Nigeria (CBN) shows the BDCs’ readiness and commitment  to full digitisation of their operations to provide seamless services to forex end-users and become direct agents of IMTOs.

    He said the  CBN captures only six per cent of the Diaspora remittances and the rest goes under the counter without any tracing.  He said riding on the Travelex high-tech will enable the BDCs address the reoccurring complaints of poor infrastructure which has kept the operators away from accessing the Diaspora remittances for years.

    Gwadabe, who spoke on the theme: ABCON’s Plans and Proposals for strengthening and Improving the Foreign Exchange Market viz-aviz the BDC Sub-sector in the Economy said the BDC operators are obligated by law to  render daily, monthly and annual returns to the Central Bank of Nigeria (CBN).

    He said the daily returns known as Daily Transaction Returns (DTR) gives details of the total sales made for the day by the BDC and comes in as DTR 202, DTR 217, DTR 305 and DTR 315.

    The DTR 217 return gives the information of the customers of whom the forex was sold to. Information like, the name, the international Passport number, Bank Verification Number, address, Tin number, email address among others while DTR 305 provides details of the customers as well their destination and reason for the purchase of forex.

    The total amount of forex sold to them is also mentioned with the transaction date.

    According to Gwadabe, DTR 315 tells BDCs’ opening balance, amount purchased in forex , the equivalent in naira and the rate of purchase, amount sold in forex, the equivalent in naira and the selling rate as well as the closing balance.

  • BDCs set N250/$ exchange rate agenda for Buhari

    Bureaux De Change (BDC) operators, under the Association of Bureaux de Change Operators of Nigeria (ABCON), have set N250 to dollar exchange rate agenda for President Muhammadu Buhari in his second term in office.

    ABCON President, Aminu Gwadabe, who spoke in Lagos at the weekend, said achieving a lower exchange rate for the economy will benefit the common man and lift businesses.

    The naira at the weekend, exchanged at N362 to the dollar at the parallel market and N358 at the BDC segment.  The local currency exchanged at N306 to dollar at the official market.

    The ABCON boss said that achieving lower exchange rate will improve the transaction volume for BDCs by enabling operators to buy and sell more dollars from available cash flow.

    He said a lower exchange rate against the greenback will also stabilise the local currency, raise investors’ confidence, improve Diaspora remittance flows and entrench fiscal discipline.

    “A stronger naira will raise Internally Generated Revenues (IGRs), help in the implementation of the restriction of foreign exchange access to 42 items that can produce locally and improve BDCs capabilities to thrive”, he said.

    Gwadabe urged the Federal Government to constitute new economic management team and review its performance in the last four years. He added that such review will give room for better performance in the second term of this administration.

    Gwadabe also urged the government to re-strategise and review its performance in the last four years and develop concrete actionable strategy for better performance.

    The ABCON chief said: “If the government waits till May 29 before setting up a think-tank economic team with functional experience on the economy, security, agriculture and human resource development, it would have wasted tangible time needed for smooth take-off.”

    He said the committee members should have deep knowledge of the economy, and be ready to access information on how these sectors have worked effectively in other countries in order to deploy similar strategy in the interest of the local economy.

    Gwadabe said that by now, government should know where the complaints over its performance in the last four years came from and give priority to tackling unemployment, fixing road infrastructure, creating better investment opportunities for the people and companies as well as strengthening the financial sector, of which BDCs are key players.

    Gwadabe said: “It is only when the economy is buoyant, that they people will be able to save, and that provide enough liquidity for banks to lend and fuel the economy. The other sub-sectors including the Bureaux De Change sector will equally be positively impacted a thriving economy.”

    He also advised the government to be more cautious at borrowing, ensuring that borrowed funds are channeled to projects that will be able to repay the loans.

    Gwadabe said that the government should equally look at the tax system, and block all revenue leakages to generate more funding for the economy.

    He said the Investors and Exporters (I&E) Forex Window introduced by the Central Bank of Nigeria (CBN) is having positive impact on the Forex market and should be sustained because of the stability it has brought to the market.

    The ABCON boss urged the government to pay more attention to promoting ease of doing business, lifting private and public enterprises and creating jobs for the people.

    He said: “There is need for fiscal restructuring by ensuring that states become more efficient in revenue generation and less dependent on federal allocations.

    “The government should focus on things that create jobs especially through small and medium enterprises by creating opportunities for them to have easy access to funds.”

    Gwadabe said the BDCs have over the years, remained a potent monetary policy tool for exchange rate stability.

    The sector, he added, has helped the government in creating over 30,000 jobs for Nigerians, thereby reducing the unemployment rate in the country.

    Gwadabe said: “The BDCs have continued to make foreign exchange available to the critical retail end users thereby deepening forex access in the country. The BDCs have also been enhancing price discovery and transparency in the foreign exchange market.”

  • BDCs boost forex receipts, account for over $20b yearly

    The Association of Bureau De Change of Nigeria (ABCON) has stated that one of the most efficient tools introduced in the management and stability of the country’s foreign exchange market by the Central Bank of Nigeria (CBN) was the involvement of the body in forex management.

    The Association’s national President, Alhaji Aminu Gwadabe, who spoke to The Nation in an exclusive interview in Lagos, stated that this is the first time the rate of Naira to other currencies has remained stabled for over one year.

    Gwadabe noted that this achievement was made possible by the partnership of BDCs with the CBN, which gave the former the opportunity to receive foreign currencies and sell at the CBN-regulated rates.

    According to him, over $20 billion come into the country annually through the BDCs, adding that the records of its members transaction goes a long way in helping the Economic and Financial Crimes Commission (EFCC) detect illicit financial transactions as well as cybercrimes.

    The ABCON boss noted that BDCs in India account for over 80$, saying that BDCs in India accounts for $30 billion annually as Indians are scattered all over the world.

    “The anti-money laundering and anti-terrorism laws are fast developing and taking shape and BDCs is part of financial institutions, though, the BDCs are the weakest link in the financial institution. It is easier to use them launder money. Having that scenario, it became very important to upgrade the knowledge of the BDCs and to sensitize them, hence, we embarked on the public sensitisation, through workshops, and training by Nigerian Financial Intelligent Unit (NFIU), an arm of the EFCC.

    “Part of the sensitisation is for our members to be able to easily detect a suspicious transaction so that it must be reported to the EFCC. There is a lot of security report that people are bringing in illicit funds to create havoc and to disrupt the peace of the country. Sometimes, these launders or money bags find it very easy to use these BDCs, so they prefer to use the BDCs because of the nature of some of the operators who do not keep records,” Gwadabe stressed.

    He said that BDCs were used as the vehicle to reach the unlicensed BDCs, which is the target of these money launders, as it is in line with antiterrorism financing.

    “We have a perfect relationship with the chairman of EFCC, CBN, the FIRS, and all other financial institutions. So, after that meeting in Lagos, we had a similar meeting with the EFCC in Abuja and Kano. This is to sensitise and train BDCs on the activities of money launders terrorism financing and to integrate reporting of these activities to the EFCC. We send our cash transection report of any amount that is above 5million, individuals and 10million for companies in the cash transaction in the NFIU. For instance, if you come to me with $10million, it is an obligatory requirement that such a transaction be reported. BDCs are also operated as an arm of the CBN. The only thing we are not doing is that we are not giving letter of credit. What the banks are doing, we are also doing.

  • ABCON alerts public over fake $100 bills import from India

    .Gets CBN, EFCC nod on campaign against fake currency

     

    The Association of Bureaux De Change Operators of Nigeria ( ABCON ) on Friday alerted the public over ongoing security investigation on $100 bills being imported from India into Nigeria.

    The ABCON President, Alhaji Aminu Gwadabe, who disclosed the development to financial journalists after the group’s National Executive Council (NEC) Meeting in Lagos, said the $100 bill is majorly counterfeited because of huge profit margins that come with it.

    He said some of the fraudsters objectives is not only to make profit, but to undermine Nigeria chances for automatic membership of the Financial Action Task Force (FATF) after assessment of the country’s financial system scheduled for the first quarter of this year.

    The ABCON boss said the issue of fake dollar in circulation has been observed and reported at the relevant security agencies adding that the ABCON, has in the interest of the economy and Bureaux De Change (BDCs) businesses, secured Central Bank of Nigeria (CBN) and Economic and Financial Crimes Commission (EFCC) backing to begin nationwide campaign against fake currencies in the country.

    He said rising cases of fake currencies in circulation has led to huge losses to BDC operators and the economy.

    Gwadabe said that ABCON, is educating the public on how to identify fake dollar bills in order to protect the image of the country in the eyes of foreign investors.

    “It is part of our objectives which in enshrined on our constitution as an association to eliminate the incidences of fake currencies circulation thereby enhancing the image of the country and transparency in our operations,” he said.

    Gwadabe said the ABCON NEC has therefore released a guide to all BDCs on how to detect a fake dollar bill. He disclosed that there are seven dollar bills of $1, $2, $5, $10, $20, $50 and $100 and seven steps to authenticate them.

    “The weight of each bill is one gram, 2.61 inches wide and 6.14 inches length. It is 75 per cent cotton and 25 per cent linen. Your finger can feel thickness and texture. Besides, the portrait watermark is partly overlapped by the Treasury seal, while the $100 bill is printed on the right side of the bill. The strip is thin, faint and runs vertically from top to bottom to the left of the watermark portrait. Also, the 3D security ribbon, also called the thread, is bright blue and vertical on the bill,” he said.

    Continuing, Gwadabe explained that the raised printing feels rough on right shoulder of Benjamin Franklin portrait while the colour shifting ink works under ultraviolet light.

    He added that the dollar bill undergoes micro printing, which is the production of recognizable patterns or characters in the bill at a scale that requires magnification to read with the naked eye. To the unaided eye, the text may appear as a solid line.

    He said that currency commonly exhibits the highest quality (smallest size) of microprint because it demands the highest level of counterfeiting deterrence.

    Gwadabe said the BDCs have over the years, remained a potent monetary policy tool for exchange rate stability and promoting transparent foreign exchange operations in the country.

    “The BDCs have helped the government in creating over 30,000 jobs, thereby reducing the unemployment rate in Nigeria. The BDCs have continued to make foreign exchange available to the critical retail end-users thereby deepening forex access in the country. This campaign against fake dollar is aimed at ensuring that forex users get value for their money,” he said.

    Continuing, Gwadabe said that BDCs have also been enhancing price discovery and transparency in the foreign exchange market.

    “The operations of BDCs have also raised the level of investors’ confidence and diaspora remittances in the country. The BDCs under my leadership will continue to operate within set regulations and highest level of transparency in forex dealings,” he stated.

  • ABCON Live Run Portal for BDCs, CBN, NIBSS, NFIU integration ready

    The Association of Bureaux De Change Operators of Nigeria (ABCON) will tomorrow launch its Live Run Automation Portal in Lagos. The ABCON Automation Live Run project is expected to automate all Bureaux De Change (BDCs) Operations with those of Nigeria Inter-bank Settlement System (NIBSS), Nigeria Financial Intelligence Unit (NFIU) and the Central Bank of Nigeria (CBN) to improve the level of compliance of the BDCs with set regulations.

    Speaking to financial reporters ahead of the portal launch, which will hold at the PISTISHUB, 1A Ikorodu road, Behind Mobil Filling Station, Maryland, Lagos, ABCON President, Aminu Gwadabe, said the group had secured the CBN’s no- objection approval to launch the Live Run  portal.

    The approval, he said, reaffirmed the regulator’s commitment to a transparent and viable forex market where stakeholders’ interests are protected.

    Gwadabe said the world is going digital, and BDC operators under his leadership are committed to staying ahead of the competition by deploying time-tested technology to deliver effective services to customers.

    He said the objective is to make Live Run portal enhance BDCs compliance with set regulations and promote market integrity.

    According to him, the portal will sustain transparent transactions in the BDC corridor, boost the morale of its members and ensure their continuous operations.

    The ABCON chief said the group had fully upgraded its Information Communication Technology (ICT) platforms, to achieve full digitisation of BDCs operations in line with its goal of sustaining transparent operation and prompt rendition of weekly returns to regulatory agencies.

    He said the group has also launched a website, the www.naijabdcs.com, to serve as a reliable platform for local and international investors, who will rely on it to access uniform forex rate across states, regions and markets nationally.

    According to Gwadabe, ABCON coordination journey of automation and digitisation of BDC’s processes started in 2016 with the launch of automation platform named www.abconng.org.ng.

    “The project came with three layers and stages. First layer is on online real time registration of our members with a success rate of over 4,100 BDCs registered nationwide. This layer is to enable our members conduct their membership registration from any of their location without coming physically to ABCON Secretariat.

    “The second layer bothers on automation of ABCON’s operational process, book keeping, issuance of receipt, preparation of accounts, balance sheets, ledgers and sales/purchase registers. The most important of this layer is the online real time rendition of returns to regulatory agencies.

    “Another important feature of this layer is the BDCs on boarding and integration of the Bank Verification Number (BVN) platform on the NIBSS portal for verifications and validation of clients’ BVNs, which is a most vital requirement forex sale.

    “Of special note is also the integration of our platform to immigration platform for the verifications of international passport. Already, we are in advance engagement with the Irish technology experts for the achievement of this idea. The final layer is the one that excites me a lot and has to do with a trading platform for BDCs in Nigeria. Our technical experts in India, Poland are in advance stage of completion for onward submission to the CBN,” he added.

  • BDCs begin yearly report publication

    Licensed Bureaux de Change (BDCs) will from this year  publish their foreign exchange purchases through the apex bank and autonomous sources in their financial statements.

    The result publication followed Central Bank of Nigeria’s (CBN’s) directive on the matter.

    CBN Director, Other Financial institutions Supervision department, Mrs. Tokunbo Martins, said the operators were also to submit total forex sold and commissions earned within the year. She noted that appropriate sanctions will apply to operators that fail to comply with the directive.

    According the apex bank, Section 13 of the Revised Operational Guidelines for the BDCs in Nigeria issued in November 2015 provides that every licensed BDC shall submit its audited financial statements to Director, Other Financial Institutions Supervision Department of the CBN for approval, not later than three months after the end of its accounting year.

    It also provides no BDC shall publish its audited accounts in a newspaper without the prior approval in writing of the CBN.

    The CBN said it has however, observed that many BDCs have not been submitting their annual audited accounts contrary to the above regulatory requirement.

    “We also observed that in some instances, the accounts were incomplete and inaccurate and that some of the accounts were not endorsed or stamped by the external auditors, thus casting doubts on their integrity and reliability.

  • CBN okays N357/$1 rate for BDCs

    The Central Bank of Nigeria (CBN) yesterday reviewed upwards the trading margin for Bureau De Change (BDC) operators to N357/$1 (buying) and sell at N360/$1 (selling).

    This gives BDCs  N3 margin per dollar sold. The BDCs previously bought from the apex bank at N360/$1 and sold at N362/$1 before the review.

    Speaking on the development,  CBN Acting Director, Corporate Communications Department, Isaac Okorafor, said the decision will give  BDCs a level playing field to  compete with other authorised foreign exchange dealers.

    He urged BDCs to abide by the new guidelines and not seek to exploit eager customers by selling above the N360 band. He warned that erring BDCs will be sanctioned in any case of infraction established against them.

    Also speaking, President, Association of Bureaux De Change Operators of Nigeria (ABCON) Aminu Gwadabe, praised the CBN for the move. He said the review will help promote exchange rate stability. The ABCON boss also said the group will sanction any BDC operator that sells dollar above the CBN-approved band.

    It will be recalled that the CBN, in March 2017, had released a forex policy, under which it directed licensed BDCs in the country to purchase forex from it at the rate of N360 to a dollar, while selling same to customers at no more than N362/$1.

    At the time of the directive in 2017, the aim of the bank was to achieve convergence between the rates in the inter-bank window and that of the BDCs.  Meanwhile, the CBN in its first sale of the month yesterday offered the sum of $100 million to dealers in the wholesale segment of the market to meet the requests of customers.