The Central Bank of Nigeria (CBN), on Tuesday, approved allocation of $20,000 to all eligible Bureau De Change (BDC) operators across the country as part of its on-going reforms.
Dr Hassan Mahmud, Director, Trade and Exchange Department, CBN, in a circular, said the move was aimed at tackling distortions in the retail segment of the nation’s foreign exchange market.
The circular, addressed to BDC Operators, said they were allowed to sell to end-users at a margin not more than one per cent above the purchase rate from CBN.
“Following the on-going reforms in the foreign exchange market, aimed at achieving an appropriate market determined exchange rate for the Naira, the Central Bank of Nigeria (CBN) 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 (BDCs) 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 at today, 27th February 2024).
“All BDCs are allowed to sell to end-users at a margin NOT MORE THAN one per cent (1%) above the purchase rate from CBN.
“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 documentations, for disbursement at the appropriate CBN Branches – ABUJA, AWKA, LAGOS and KAΝΟ),” it started.
A guideline was attached for the BDCs’ disbursement and monitoring of utilization.
It noted that all those allocated Foreign Exchange, must keep records of beneficiaries and amount sold to each of them.
It said BDCs should not sell more than $4,000 per individual for Personal Travel Allowance and $5,000 for Business Travel Allowances.
It listed other guidelines including, BDCs allocated buying and selling rate, prohibition of street hawking of forex, daily provision of the sale of Foreign Exchange to end users, among others.
