The Association of Bureau De Change Operators of Nigeria (ABCON) has commended the Central Bank of Nigeria (CBN) for lifting the suspension of sales of interbank foreign exchange to its members nationwide, saying this would tame the country’s inflation among other benefits.
ABCON President, Dr Aminu Gwadabe, said this in a statement on Friday in Lagos.
According to him, this gesture would lead to job creation and also boost FX liquidity to the retail end, among others.
“To our members, it will revitalise our operations, making us functional and profitable. It will also improve our compliance obligations to security and monetary agencies,” he said.
Appeal to BDCs, banks
Gwadabe expressed delight that CBN also considered its members’ accessibility to the new Electronic Foreign Exchange Matching System (EFEMS) market through the banks.
“This development is a testament to the CBN’s recognition of our third-level roles in the foreign exchange market architecture.
“I therefore urge all our members to act within the directives in the circular and ensure the desired result of the appreciation of our local currency is sacrosanct,” he said.
According to him, BDCs should render their returns regularly, operate inside their offices and ensure seamless automation of their process.
“Finally, I plead with the banks to ensure transparency, level playing field in the discharge of their responsibilities to our members nationwide,” he said.
Backstory
The CBN on Thursday granted BDC operators temporary permission to purchase up to $25,000 weekly in foreign exchange (FX) from the Nigerian Foreign Exchange Market (NFEM).
This move, detailed in a circular dated December 19, 2024, is designed to meet seasonal retail demand for FX during the holiday period.
- According to the circular signed by T.G. Allu, on behalf of the Acting Director of the Trade and Exchange Department, the arrangement will be in effect from December 19, 2024, to January 30, 2025.
- Under the directive, BDCs may purchase FX from a single Authorized Dealer of their choice, provided they fully fund their accounts before accessing the market.
- The transactions will occur at the prevailing NFEM rate, and BDCs are required to adhere to a maximum 1% spread when pricing FX for retail end-users.
- All transactions conducted under this scheme must be reported to the CBN’s Trade and Exchange Department.
What you should know
Nairametrics reported that the CBN’s ongoing reforms in the foreign exchange market have bolstered liquidity and confidence, with the naira settling below the N1,550/$ threshold in the official market on Friday.
CBN data revealed that the Nigerian naira strengthened against the dollar on Thursday, closing at N1,540/$—a N5 gain from Wednesday’s closing rate of N1,545/$ at the Nigerian Foreign Exchange Market (NFEM).
The naira’s value remained relatively stable at N1,660 to the US dollar in the black market.
