The Central Bank of Nigeria (CBN) has announced the repayment of capital deposit and licencing fees to promoters who have pending Bureau de change (BDC) licence applications.
This disclosure is contained in a circular with reference number FPR/DIR/PUB/CIR/001/019, issued on Wednesday, July 28, 2021, and signed by CBN’s Director, Financial Policy and Regulation Department, Ibrahim S. Tukur.
The decision by the CBN is to further strengthen the directive to discontinue the sale of dollars to BDC operators and only sell directly to the deposit money banks. According to the circular, such BDC promotors should further their request in writing to the Director, Financial Policy and Regulation Department, Central Bank of Nigeria, Abuja.
The apex bank also instructed all deposit money banks to stop accepting instructions from customers to transfer capital deposits of N35 million to the CBN account for the proposal of BDC licences.
Backstory
The central bank slammed the Bureau De Change (BDC) for unlawful forex trading on Wednesday, announcing that it would no longer provide forex to Bureau De Change operators in Nigeria.
The CBN Governor said, “We have noted with disappointment and great concern that our Bureau De Change operators have abandoned the origin objective for their establishment, which was to serve retail end users who need $5,000 or less. Instead, they have become wholesale dealers, illegally in foreign exchange to the tune of millions of dollars per transaction.
“Despite the fact, that Nigeria is the only country in the world today where a central bank sells dollars directly to the Bureau De Change operators, the Nigerian Bureaus De Change segment have not reciprocated the bank’s gesture to help maintain price stability in that market.”
What this means
This action by the apex bank shows strong resolve in the pursuit of currency stability. Individuals who have sent capital deposits to the CBN’s account, in hopes of getting a license, would be refunded when they follow the steps stated in the circular.
Furthermore, deposit money banks are expected to stop following customers’ directives to send money to the CBN’s account for licencing.
