The president, Association of Bureaux De Change Operator of Nigeria (ABCON), Alhaji Aminu Gwadabe said the Bureau De Change (BDC) business has been negatively affected by uncompetitive rate, as the CBN sells dollars to BDCs at higher rate compared to what the regulator sells to commercial banks, yet both institutions target the same market segment and customers.
This confirms the recent report which says that over 700 Bureau De Change (BDC) operators have in recent months been rendered inactive in the Central bank of Nigeria’s (CBN) Forex Window.
Reasons why over 700 BDCs are inactive
According to Gwadabe, the BDCs buy dollar from the CBN at N360/$1 and sell to end users at N362/$1 while the regulator sells to commercial banks at N358/$1 and the banks sell to end users at N360/$1.
He described the buying rate for the BDCs as uncompetitive and a big disincentive for many forex users to patronize the operators.
He lamented that BDCs are not only buying at exorbitant rate, but also sell at a rate higher than that of the banks hence, creating low patronage for the operators.
He further stressed that since both banks and BDCs operate and service the same market, both institution should get dollars at the same rate to allow for fair competition.
The ABCON boss solicited for a review in the rate which dollar is sold to the BDCs by the CBN so as to boost ongoing recovery of the naira against dollar.
He said the success recorded by the CBN in stabilizing the naira was largely contributed by the BDCs which remain backbone of the retail forex segment of the economy.
In addition, Gwadabe called on the CBN to increase the volume of Personal Travel Allowances (PTAs) from $4,000 to $8,000; Business Travel Allowances (BTAs) from $5,000 to $10,000; school fees from $5,000 to $20,000 and medicals from $5,000 to $15,000 quarterly to deepen liquidity in the market.
