Central Bank of Nigeria Reduces Approved Bureau de Change Dealers

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The Central Bank of Nigeria (CBN) has published an updated list of approved Bureau de Change (BDC) dealers in the country, revealing a significant reduction in the total number of approved operators. The latest document, titled ‘Approved BDCs,’ indicates that the number of licensed BDCs has decreased to 2,991, with the licences of 2,698 BDCs being withdrawn.

In contrast, the CBN had previously approved 5,689 BDC dealers as of December 31, 2021. This indicates a considerable decline in the number of BDCs in the country over the years.

The surge in BDC operators occurred during the tenure of former CBN Governor, Godwin Emefiele. However, due to concerns over round tripping and involvement in illegal financial flows, the sale of foreign exchange to BDCs was banned.

The new administration, in response to policy advisory council recommendations, is considering key reforms that may include raising the capitalization requirements for BDC operators and allowing Nigerian banks to operate as primary dealers to supply the forex market.

Opinion: The Central Bank of Nigeria’s decision to reduce the number of approved Bureau de Change dealers is likely a response to concerns over their involvement in illegal financial activities. While the surge in BDC operators occurred under the former CBN Governor’s tenure, the new administration is taking steps to address the challenges by considering key reforms such as raising capitalization requirements and exploring alternative ways to supply the forex market. These measures are essential to ensure transparency, stability, and efficient forex operations in the country.

Punch.

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