The Central Bank of Nigeria (CBN) has introduced new regulations allowing Bureau de Change (BDC) operators to purchase up to $25,000 weekly from a single Authorised Dealer Bank (ADB) to cater to retail forex demand for eligible invisible transactions.
The directive, outlined in a circular from the Trade and Exchange Department and signed by Dr. W. J. Kanya, the Acting Director, is dated February 5, 2025.
It sets compliance requirements aimed at promoting transparency and curbing potential forex misuse.
Key Provisions of the New Guidelines include: Single Dealer Bank Rule: Each BDC can only source FX from one authorised dealer bank per week, a measure designed to prevent speculation and enhance regulatory oversight.
It says violators will face sanctions.
According to the bank, authorised dealers must sell FX to BDCs at the prevailing rate in the Nigerian Foreign Exchange Market (NFEM) window, ensuring uniform pricing.
BDCs cannot charge more than Ipercent above their purchase price when selling FX, regardless of its source, to prevent excessive charges and promote fairness.
“Purchased FX can only be used for specific transac-tions, with a cap of $5,000 per transaction per quarter.
Eligible uses include:Busi-ness Travel Allowance (BTA)
/ Personal Travel Allowance (PTA); Overseas school fees ;Overseas medical expenses;
Strengthened Anti-Money Laundering Measures, ” the circular.
To combat financial crimes, the CBN mandates that BDCs to maintain proper records, including the Bank Verification Number (BVN) of end-users.
It also mandates them to endorse disbursed amounts in beneficiaries’ international passports;Strictly comply
with Anti-Money Laundering (AML) laws and Know Your Customer (KYC) requirements.
To enhance transparency, both ADBs and BDCs must submit reports to the CBN.
They must send weekly reports of FX sales to BDCs in a specified Excel format via teddmo@cbn.gov.ng.
The CBN noted that BDCs must render daily returns on forex purchases and utilisa-tion through the Financial Institutions Forex Reporting System (FIFX).
The CBN warns that any BDC or Authorised Dealer Bank found violating these guidelines-including forex diversion-will face severe sanctions, including the suspension of their dealership license.
In a related development, the CBN has extended the deadline for BDC operators to access the Nigerian Foreign Exchange Market (NFEM) for weekly FX purchases. Initially set for January 31, 2025, the deadline has been pushed to May 30, 2025.
The extension is expected to stabilise the parallel market, improve liquidity, and reinforce the CBN’s commitment to ensuring forex accessibility while maintaining regulatory oversight.
These new measures align with the apex bank’s broader strategy to stabilise the naira, curb speculative activities, and enhance forex market transparency.
