Tunji Wusu –
In an effort to reduce illegal financial activity and improve currency rate stability, the Central Bank of Nigeria (CBN) has reduced the number of Bureau de Change dealers on its registry to 2,991.
With the latest move by the central bank, there are now 2,991. The licenses of 2,698 operators were revoked by the apex bank after it issued a list of authorized BDCs.
The BDCs, whose numbers increased from 74 in 2005 to 5,689 in 2021, have played a significant role in determining the currency rate in Nigeria.
The CBN governor who has been suspended, Godwin Emefiele, highlighted worries about money laundering and other illegal financial activity, which led to the ban on selling foreign currency to BDCs.
During Tinubu’s government, suggestions have been made to implement significant reforms in reaction to the devaluation of the currency since the naira’s floating in June.
Raising the capitalization requirements for BDC operators and enabling Nigerian banks to function as primary dealers in the FX market are two examples of the reforms.
As of the most recent update, the naira closed at N820 per dollar on the parallel market, N1,095 per British pound, and N905 per euro, while the exchange rate through the Investors’ and Exporters’ FX Window hit N795.28 per dollar.
The number of Bureau de Change dealers has been lowered by the Central Bank of Nigeria to 2,991.
A list of approved BDCs was issued by the CBN yesterday in a document titled “Approved BDCs.” The document stated that 2,698 BDCs had their licenses cancelled.
The apex bank released a list resembling this one last year, approving 5,689 black market dealers. In Nigeria, BDCs have a big impact on how the exchange rate is set.
Operator numbers have significantly increased, going from 74 in 2005 to 5,689 in 2021.
Godwin Emefiele, a former governor of the Central Bank of Nigeria, later forbade the sale of foreign currency to BDCs amid worries that they would engage in round-tripping and other illegal financial activities.
Key changes include raising the capitalization requirements for BDC operators and enabling Nigerian banks to function as primary dealers in the FX market were recommended for implementation during Tinubu’s government.
The naira has declined since the CBN floated it in June, with the exchange rate at the Investors’ and Exporters’ FX Window reaching N795.28.
The naira ended the day at N820 per dollar, N1,095 per British pound, and N905 per euro on the parallel market.
