By Mohammed Useni
The Central Bank of Nigeria has ordered existing Bureau De Change operators to re-apply for a new license as it updated its regulatory guidelines.
The apex bank stated that after consulting with stakeholders, the following changes were made:
- The mandatory caution deposit of N200m for tier-1 BDC licence holders has been removed.
- Similarly, N50m for tier-2 licence holders has also been waived.
- The non-refundable annual licence renewal fee has been withdrawn.
- Previously, tier-1 BDCs paid N5m, while tier-2 BDCs paid N1m for renewal.
The bank noted that these adjustments aim to streamline BDC operations and enhance financial accessibility.
The Director, Financial Policy and Regulation Department at the apex bank, Haruna Mustafa disclosed this in a circular uploaded to the bank’s website on Wednesday.
Mustafa stated that existing BDCs must re-apply for a new licence based on their preferred tier or licence category as outlined in the guidelines.
New BDC licence applicants must meet the conditions specified for their chosen BDC category.
Existing BDCs must meet the minimum capital requirements for their selected licence category within six months from the effective date of the guidelines.
The guidelines also revised permissible activities for BDCs, ensuring alignment with market needs and regulatory standards.
Mustafa noted that the BDCs are expected to adhere to corporate governance requirements and anti-money laundering, counter-terrorism financing, and counter-proliferation financing provisions.
The bank added that receipt and processing of license applications will begin from the effective date of the guideline.
It said that interested applicants should submit the following information electronically to [email protected]: Name of the promoter, Name of the proposed BDC, E-mail address of the promoter, Phone number of the promoter
These guidelines replace the Revised Operational Guidelines for Bureau De Change in Nigeria issued in November 2015 and all related circulars and directives.
The Regulatory and Supervisory Guidelines for BDC Operations take effect from June 3, 2024.
The circular partly read, “As part of reforms to re-position the Bureau De Change (BDC) sub-sector to play its envisioned role in the foreign exchange market in Nigeria, the Central Bank of Nigeria (CBN) issued the Draft Operational Guidelines for BDC Operations in Nigeria in February 2024, for stakeholder comments/inputs.
“Following the conclusion of the stakeholder consultations and in the exercise of the powers conferred on it by Section 56 of the Banks and Other Financial Institutions Act (BOFIA) 2020, the CBN hereby issues the attached Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria 2024 for compliance by all operators and promoters of proposed BDCs in Nigeria.
“The guidelines, amongst others, introduce new licensing requirements and categories of BDCs as well as revise the permissible activities, financial requirements, corporate governance requirements and AML/CFT/CPF provisions for BDCs.
“All existing BDCs shall: Re-apply for a new license according to any of the Tiers or license categories of their choice as provided in the Guidelines.
“Meet the minimum capital requirements for the license category applied for within six (6) months from the effective date of the Guidelines.
“Applicants for New BDC License Applicants for a new BDC license are required to meet the conditions for the grant of license in accordance with the Tier or category of BDC chosen as stipulated in the Guidelines. Receipt and processing of applications for license shall commence from the effective date of the Guidelines.”
