CBN Approves Weekly FX Sales Of $150,000 To Each BDC

The Central Bank of Nigeria has authorised licensed Bureau De Change operators to participate in the Nigerian Foreign Exchange Market as part of efforts to boost foreign exchange liquidity in the retail segment and satisfy the legitimate demands of end users.

The apex bank also set a weekly foreign exchange purchase limit of 150,000 dollars for each BDC, with usage required to comply with existing operational guidelines.

According to a circular signed by the Director of the Trade and Exchange Department, Musa Nakorji, all BDCs licensed by the CBN are allowed to obtain foreign exchange through any Authorised Dealer Bank of their choice at prevailing market rates.

The circular stated that the initiative is intended to enhance market efficiency and expand access to foreign exchange throughout the economy.

However, the CBN introduced strict compliance and risk management requirements for such transactions.

Authorised dealers must carry out comprehensive Know Your Customer checks and due diligence on BDC clients before processing any foreign exchange sale.

To promote transparency and accountability, the CBN instructed all licensed BDCs to submit prompt and accurate electronic returns in accordance with existing regulations.

Any foreign exchange not utilised must be returned to the market within 24 hours, as BDCs are not permitted to retain FX positions acquired from the Nigerian Foreign Exchange Market.

The circular also places limits on settlement procedures, requiring that all foreign exchange transactions be executed through settlement accounts held with licensed financial institutions.

Third party transactions are not allowed, and cash settlements are restricted to a maximum of 25 percent of the total transaction value.

Overall, the directive forms part of the CBN’s broader approach to combine improved market access with firm regulatory oversight, ensuring liquidity in the foreign exchange market while protecting the stability of the financial system.