The Central Bank of Nigeria (CBN) has announced a significant decision to resume the sale of foreign exchange to eligible Bureau De Change (BDC) operators across the country.
This decision comes after more than two years of suspension, during which the former CBN governor, Godwin Emefiele, halted the sales of foreign exchange to BDC operators in that segment of the forex market.
In a new circular issued and signed by the Director of the Trade and Exchange Department, Hassan Mahmud, the CBN stated that it would sell foreign exchange worth $20,000 to each eligible BDC operator.
The move is aimed at rectifying persisting distortions in the retail segment of Nigeria’s foreign exchange market and bridging the widening gap in the exchange rate.
The allocation will be sold at a rate of N1,301/$, reflecting the lower band rate of executed spot transactions at the Nigerian Autonomous Foreign Exchange Market as of the previous trading day, dated February 27, 2024.
The circular emphasized that the sale of foreign exchange to BDCs is part of the ongoing reforms in the foreign exchange market to achieve an appropriate market-determined exchange rate for the Naira.
BDCs are allowed to sell to end-users at a margin not more than one per cent above the purchase rate from the CBN.
Eligible BDCs are directed to make Naira payments to designated CBN Foreign Currency Deposit Naira Accounts and submit confirmation of payment, along with other necessary documentation, for disbursement at the appropriate CBN branches in Abuja, Awka, Lagos, and Kano.
This decision by the CBN is part of its frantic efforts to address the free fall of the Naira and stabilise the foreign exchange market.
