February 6, 2025/CBN

The Central Bank of Nigeria (CBN) has issued new guidelines for the sale of foreign exchange to Bureau De Change (BDC) operators, following the circular TED/FEM/FPC/001/030 dated December 19, 2024, which granted temporary access for BDCs to purchase FX from authorised dealers.

Key provisions of the guidelines include:

1. Authorised Dealers shall sell foreign exchange cash to BDCs subject to a maximum of US$25,000 (Twenty-five Thousand United States dollars) to a BDC weekly. A BDC shall approach its preferred Authorised Dealer Bank (ADB) and can only procure the said amount from that bank of its choice in a week. Any breach of this condition will attract appropriate sanction.

2. The selling rate by the Authorised Dealers to BDCs shall be the prevailing day rate at the NFEM window;

3. Foreign exchange cash purchased by BDCs from Authorised Dealer Banks shall be solid to foreign exchange end-users at a rate not exceeding one (1) per cent margin above the buying rate

4. For the avoidance of doubt, the one (1) per cent margin stated in (3) above shall be applicable to all funds to be retailed by BDCs regardless of sources of funds.

5. Authorised Dealer Banks shall continue to render weekly returns on sales to BDCs as specified in the attached Excel format to the Trade and Exchange Department, CBN, Abuja through this email: teddmo@cbn.gov.ng

6. All BDCs are required to render daily returns on foreign exchange purchases from Authorised Dealer Banks and other sources as well as sales (utilisation) on the Financial Institutions Forex Reporting System (FIFX);

7. Funds purchased by BDCs shall be disbursed for the following eligible transactions only. In all cases, the maximum disbursement per transaction shall not exceed USD5,000.00 quarterly

a.    Business Travel Allowance/ Personal Travel Allowance

b.    Overseas School fees

c.    Overseas Medical fees

8. Records shall be maintained for all transactions by the BDCs showing the BVN of the end-user, including endorsement of the amount disbursed in the International Passport of the beneficiary:

9. It is to be noted that Authorised Dealer Banks and BDC operators shall ensure strict compliance with the provisions of Anti-Money Laundering Laws and observance of appropriate KYC principles in the handling of these transactions.

10. Any Authorised Dealer and BDC that diverts funds or violates the provision of these guidelines shall attract appropriate sanctions, including suspension of its dealership license

The CBN emphasised strict compliance with these guidelines to ensure transparency and efficiency in the foreign exchange market.

Culled: Proshare