The Central Bank of Nigeria (CBN) has announced a revised policy for the sale of foreign exchange (FX) to Bureau De Change (BDC) operators from Thursday, March 28th, 2024. This comes a month after the CBN initially resumed FX sales to BDCs.
The new policy reflects a reduction in the amount of FX available to BDCs and the rate at which they can purchase it.
BDCs will now be able to buy $10,000 worth of FX from the CBN at a rate of N1,251 per dollar. This represents a decrease from the $20,000 allocation and N1,301 per dollar rate offered in February 2024.
The CBN has also tightened regulations on the profit margin BDCs can earn on FX sales.
BDCs are now allowed to sell FX to eligible end-users at a maximum spread of 1.5 percent above the purchase price from the CBN. Previously, the spread was capped at 1 percent
In a letter addressed to the President of the Association of Bureau De Change Operators of Nigeria (ABCON), Dr. Hassan Mahmud, Director, Trade and Exchange Department at the CBN, explained the rationale behind the adjustments.
The CBN, he said, aims to address “continued price distortions at the retail end of the market,” which the bank believes contributes to a wider gap between the official exchange rate and the black market rate.
The CBN has outlined specific instructions for BDCs to access the FX: all eligible BDCs must make Naira payments to designated CBN Naira Deposit Accounts before the close of business on Thursday, March 28 2024 and confirmation of payment while required documentation, must be submitted for FX disbursement at designated CBN branches in Lagos, Abuja, Awka, and Kano.
The CBN’s revised FX policy for BDCs highlights its ongoing efforts to achieve a stable and market-driven exchange rate in Nigeria.
This move follows the initial resumption of FX sales to BDCs in February 2024, which aimed to address challenges in the retail FX market.
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