December 11, 2025/CSL Update
The Central Bank of Nigeria (CBN) has approved operating licenses for 82 new Bureau De Change (BDC) operators, effective 27 November 2025. According to the Apex Bank, this development represents a significant step in its ongoing reform agenda to restore order, transparency, and efficiency in the retail segment of the foreign exchange market.
The new approvals follow major regulatory actions taken in 2024, when the CBN revoked the licenses of 4,173 BDC operators for violating operational guidelines, facilitating illicit forex transactions, and encouraging widespread street trading, activities that fueled market distortions and speculative pressure on the Naira.
A central feature of the new regulatory framework is the introduction of a tier-based licensing system for BDC operators. Under this structure, operators are classified into Tier 1 and Tier 2, with capital requirements of ₦2 billion and ₦500 million respectively, and each tier assigned distinct operational mandates. Tier 1 BDCs can operate nationwide, open multiple branches, offer digital forex services, and maintain correspondent relationships with international financial institutions.
Tier 2 operators, by contrast, are limited to operating within a single state and are restricted to basic retail FX transactions. By raising capital thresholds and defining clear operational boundaries, the CBN aims to promote a more transparent and competitive environment, one in which legitimate operators can function without the market distortions caused by unregulated parallel activities. The reforms are also expected to encourage wider use of digital FX platforms and enhance the traceability of forex flows, ultimately contributing to a more stable and efficient market.
Despite the clear advantages, implementing the new BDC regulatory framework may present several challenges. Operators could struggle to meet the higher capital requirements, while regulators may face capacity constraints in enforcing compliance, monitoring digital platforms, and managing the transition. Existing BDCs may incur significant restructuring and technology-upgrade costs, and resistance from entrenched parallel-market players could undermine the reforms.
Geographic imbalances may also arise if operators avoid less profitable regions, limiting access to retail forex services. In addition, gaps in digital infrastructure, heightened risks of cyber-fraud, and the need for stronger coordination with law- enforcement agencies could complicate implementation. Ultimately, the success of the reforms will depend on building public trust and encouraging a shift from informal street trading to regulated and digital FX channels.
Click here to download full report: CSL Nigeria Daily – 11 December 2025 – Financial Services.pdf
