CBN
The Central Bank of Nigeria (CBN) has announced its decision to sell $20,000 in foreign exchange to eligible Bureau De Change (BDC) operators across the country. This was revealed in a statement signed by the Acting Director of the Trade and Exchange Department, Dr. W. J. Kanya, on Wednesday.
The CBN explained that this move is aimed at helping BDC operators meet the demand for eligible invisible transactions in the retail market.
The announcement comes just hours after the naira depreciated further against the dollar, reaching N1,658.48 in the Nigerian Autonomous Foreign Exchange Market (NAFEX) on Tuesday. In the parallel market, BDC operators sold dollars at a rate of N1,670.
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The statement from the CBN reads, “This is to inform Bureau De Change operators and the general public that the CBN will be injecting additional liquidity into this segment of the foreign exchange market. To this end, the CBN has approved the sale of US$20,000.00 to each eligible BDC at a rate of N1,590/$. This is to address the demand for invisible transactions.”
However, the CBN also emphasized that BDC operators must not sell at a margin higher than one percent above the purchase rate. This means that operators cannot earn more than N15.59 profit per dollar sold to their customers.
This intervention is designed to satisfy demand for invisible transactions while also addressing the widening gap in exchange rates between the official and parallel markets.
“All BDCs are permitted to sell to eligible end-users at a margin of no more than one percent above the CBN purchase rate,” the CBN warned.
The CBN also provided instructions for participating BDCs, requiring them to deposit their Naira payments into the CBN’s designated accounts and submit the necessary documentation at branches in Abuja, Awka, Kano, and Lagos for the collection of the $20,000 allocation.
This is the seventh time the CBN has sold foreign exchange to BDCs since resuming such transactions earlier this year. BDC sales were suspended in 2021, and the ban was only lifted after the licenses of over 4,173 operators were revoked in February 2023.
With 1,583 approved BDC operators in the country, the CBN’s intervention could inject approximately $31.66 million into the retail segment of the forex market during this round of sales.
Meanwhile, the naira continued to weaken, falling by N9 or 0.53 percent to N1,667.42 at the close of trading at NAFEX on Wednesday, down from N1,658 recorded on Tuesday.
