The Central Bank of Nigeria (CBN) says it has approved the participation of licensed Bureau De Change (BDC) operators in the Nigerian Foreign Exchange Market (NFEM).
According to a circular signed by the Director, Trade and Exchange Department, Musa Nakorji, the move is part of efforts to improve foreign exchange liquidity in the retail segment of the market.
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The circular said that the CBN had also approved that weekly FX purchases by each BDC be capped at $150,000 and that utilisation comply with existing BDC operational guidelines.
“All BDCs duly licensed by the CBN are permitted to access foreign exchange through any Authorised Dealer Bank of their choice, at the prevailing market rates.
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“The move aims to deepen market efficiency and ensure broader access to foreign exchange across the economy,”it said.
The CBN, however, imposed strict compliance and risk-management conditions on the transactions.
It said that authorised dealers were required to conduct full Know-Your-Customer (KYC) and due diligence checks on BDC clients before any FX sale.
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To strengthen transparency and accountability, the central bank directed that all licensed BDCs submit timely, accurate electronic returns in line with extant regulations.
It added, “Any unutilised foreign exchange must be sold back to the market within 24 hours, as BDCs are prohibited from holding FX positions purchased from the NFEM.”
The circular further restricts settlement practices, mandating that all FX transactions be conducted through settlement accounts with licensed financial institutions.
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It said that third-party transactions were prohibited, while cash settlement is limited to a maximum of 25 per cent of each transaction amount.
“Overall, the directive reflects the CBN’s broader strategy to balance market access with strong regulatory oversight, ensuring liquidity in the foreign exchange market while safeguarding financial system integrity.”
(NAN)
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