The Central Bank of Nigeria (CBN) has approved the participation of licensed Bureau De Change (BDC) operators in the Nigerian Foreign Exchange Market (NFEM), allowing each operator to access up to $150,000 weekly to improve retail foreign exchange liquidity.
The directive was contained in a circular signed by the Director of the Trade and Exchange Department, Dr. Musa Nakorji.
According to the apex bank, the move is designed to enhance liquidity in the retail segment of the foreign exchange market and deepen overall market efficiency.
“All BDCs duly licensed by the CBN are permitted to access foreign exchange through any Authorised Dealer Bank of their choice at prevailing market rates,” the circular stated.
The bank clarified that weekly FX purchases by each BDC would be capped at $150,000 and must strictly comply with existing operational guidelines.
Strict Compliance Measures
To ensure transparency and safeguard financial system stability, the CBN imposed strict compliance and risk-management requirements.
Authorised Dealer Banks are mandated to conduct comprehensive Know-Your-Customer (KYC) and due diligence checks before executing FX sales to BDC operators.
The apex bank also directed all licensed BDCs to submit timely and accurate electronic returns in line with regulatory standards.
It further stipulated that any unutilised foreign exchange must be resold into the market within 24 hours, as BDCs are prohibited from holding FX positions purchased from the NFEM.
Additionally, all FX transactions must be conducted strictly through settlement accounts with licensed financial institutions. Third-party transactions are prohibited, while cash settlement is capped at 25 per cent of each transaction value.
Market Stability Strategy
The directive reflects the CBN’s broader reform strategy aimed at balancing increased market access with robust regulatory oversight.
Analysts say the move could improve liquidity at the retail level while maintaining discipline and transparency in the foreign exchange market.
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