The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, says Bureau De Change (BDC) operations in the country should not be an all comers’ affairs, noting that the apex bank is putting “strict regulations” together to sanitise the market against arbitrage.
He stated this on Tuesday in Abuja at the Monetary Policy Committee (MPC) meeting of the apex bank, the first since he assumed office in September 2023.
Nigeria is battling rising inflation, food inflation, forex crisis, economic hardship and high cost of living occasioned by the removal of petrol subsidy, attracting protests in parts of the country.
The naira has suffered an all-time low since the new administration floated the currency and unified the exchange rate windows. The Nigerian currency moved from over N700/$1 in May 2023 to more than N1500/$1 at the moment.
However, Cardoso said that the apex bank is moving to a “very aggressive regulatory environment”, adding that the CBN will do all in its powers to curb arbitrage.
The CBN governor said, “Too many people had gone into that sector and as at last time, I believe we had over 5,000 Bureau de Change, going on to 6,000 which definitely had different interests depending on when they saw themselves
“At some point in time, the Bureau de Change was used strictly with the intention of many who applied for these licenses to take advantage of the different windows in the foreign exchange market and in the process, arbitrage the system on an ongoing basis.
“We are hoping that by the time these guidelines come up, we propose that for certain categories of BDCs in a particular location, the minimum share capital will be half a billion naira, and for those who choose to work throughout the country, their share capital is N2bn.
“We are also putting strict regulations as to who should be a potential owner of a BDC. In order words, we don’t expect it to be an all comers’ affairs; we expect it to be those who are serious and who genuinely want to provide services for Nigerians, and not for themselves.”
Cardoso said technology will be deployed for the operations of BDCs and the regulatory exercise will “increase competition and competition should drive down prices and Nigerians should benefit from it”.
