Central Bank of Nigeria Revokes Licenses of Over 2,600 Bureau de Change Operators
In a recent move, the Central Bank of Nigeria (CBN) has reduced the number of Bureau de Change (BDC) dealers to 2,991 by revoking the licenses of 2,698 operators. The CBN officially published a document titled “Approved BDCs,” which outlined the list of authorized BDCs.
This action comes as a significant step by the apex bank to streamline the BDC sector, as the number of operators had grown exponentially over the years. In fact, the figure rose from 74 in 2005 to a staggering 5,689 in 2021, according to the previous list published by the CBN.
The role of BDCs in determining the exchange rate in Nigeria cannot be understated. However, concerns over round tripping and involvement in illicit financial activities prompted the suspended CBN Governor, Godwin Emefiele, to halt the sale of foreign exchange to BDCs.
To bring about necessary reforms, recommendations were made under Tinubu’s administration, including increasing the capitalization requirements for BDC operators and allowing Nigerian banks to act as primary dealers in the forex market.
Since the CBN implemented the floating of the naira in June, the currency has experienced depreciation. At the Investors’ and Exporters’ FX Window, the exchange rate reached N795.28.
Meanwhile, in the parallel market, the naira closed at N820 per dollar, N1,095 per British pound, and N905 per Euro.