CBN authorises weekly $150,000 FX sales to licensed BDCs

THE Central Bank of Nigeria (CBN) has approved licensed Bureau De Change (BDC) operators to participate in the Nigerian Foreign Exchange Market (NFEM) to enhance liquidity in the retail segment and address the legitimate foreign exchange (FX) needs of end users. Under the new guideline, each BDC’s weekly FX purchase is capped at $150,000, and all transactions must adhere to existing BDC operational rules.

The directive, communicated through a circular signed by Director of the Trade and Exchange Department, Dr. Musa Nakorji, allows licensed BDCs to access FX via any authorised dealer bank at prevailing market rates. The move is intended to improve market efficiency and expand access to FX across the economy.

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The CBN emphasised strict compliance and risk-management measures. Authorised dealer banks are required to perform comprehensive Know-Your-Customer (KYC) checks and due diligence on BDC clients before approving any FX sale.

To reinforce transparency, the central bank has instructed that all licensed BDCs submit accurate electronic returns promptly, in line with current regulations. Unused FX must be returned to the market within 24 hours, as BDCs are prohibited from holding FX positions sourced from the NFEM.

Settlement procedures have also been clarified. FX transactions must go through settlement accounts with licensed financial institutions, with third-party dealings forbidden. Cash settlement is capped at 25 percent of the transaction value.

The policy highlights the CBN’s broader strategy to ensure sufficient FX liquidity while maintaining strong regulatory oversight and safeguarding the integrity of the financial system, the CBN said.