The meeting was held at the
Presidential Villa in Abuja on Sunday, February 25, 2024.
Those in the meeting include
Alhaji Aliko Dangote, President, Dangote Groups; Tony Elumelu, Chairman, Heirs
Holding and Transcorp Plc; Abdulsamad Rabiu, Chairman, BUA Group; Wale Tinubu,
and other members of the private sector.
This is coming amid the
economic hardship confronting Nigerians.
The current hardship is
occasioned by the rise in the exchange rate of dollars to naira.
Recall that at the close of
work on Friday, FMDQ data showed that the naira depreciated to N1,665.50 per US
dollar from N1571.31 on Thursday.
Meanwhile, the Central Bank of
Nigeria announced draft guidelines in a sweeping policy intervention for BDCs,
including a ban on street trading and a fresh per capita share requirement for
registration.
In a statemnt on Friday titled;
“‘Revised Regulatory and Supervisory Guidelines for Bureau De Change Operations
in Nigeria’, the Financial Policy and Regulation Department of the CBN headed
by Haruna B Mustafa detailed what is now expected of BDCs in Nigeria.
1. Capital Requirements
The newly introduced guidelines
categorize BDCs into two tiers with varying capital requirements. Tier 1 BDCs
are now mandated to maintain a minimum capital requirement of N2 billion, while
Tier 2 BDCs must adhere to a capital threshold of N500 million.
Previously, a minimum capital
requirement from N35 million was set for all BDCs.
2. Banks, NGOs, Government
Agencies are barred from owning or Operating BDCs
According to the Circular,
Various Categories of financial institutions are prohibited from holding
ownership stakes in Bureau De Change (BDCs), either directly or indirectly.
This includes commercial banks,
merchant banks, non-interest banks, and payment service banks. Additionally,
other financial institutions (OFIs), such as holding companies and payment
service providers, are also barred from owning BDCs.
Furthermore, ineligible
entities encompass non-governmental organizations (NGOs), employees of
financial regulatory and supervisory agencies, government entities at all
levels, public officials, and cooperative societies, among others.
3. BDCs are barred from dealing
in Gold, taking Deposits
Bureau De Change (BDCs) are
authorized to engage in specific activities outlined by the Central Bank of
Nigeria (CBN), including the buying and selling of foreign currencies, issuing
prepaid cards, and serving as cash points for money transfer operators.
However, they are prohibited
from accepting deposits, extending loans, trading in gold, or participating in
capital market activities. Furthermore, CBN said BDC operators can not engage
in street trading, maintenance of any type of account for the public, and
opening or maintaining any account with any financial institution outside
Nigeria.
They are also banned by the CBN
from engaging in offshore business, financing political activities, selling FX
on credit to customers and granting loans, as well as international inward
transfers (except for operators that serve as cash-out points for International
Money Transfer Operators).
4. Sourcing/Sale of FOREX
BDCs are permitted to source
forex from authorized dealers, travelers, hotels, embassies, and other approved
channels as specified by the new regulatory guidelines.
Regarding the sale of foreign
currencies, BDCs can sell forex for purposes such as travel, medical bills, and
school fees, up to specified limits per customer annually.
They can also sell for the
repurchase of unused naira from a non-resident from whom the BDC had sourced
foreign currency in the course of the visit.
5. 75% of Transactions must be
through Electronic Channels
At least 75 percent of the
sales must be conducted through electronic transfers, while the remaining 25
percent can be in cash.
A beneficiary of BTA or PTA
shall receive up to 25 percent of the foreign currency in cash, according to
the CBN, and the remaining 75 percent shall be transferred to the customer
electronically (to the customer’s Nigerian domiciliary account or prepaid card).
6. Customers with $10,000 and above
must declare Source of FX
The Central Bank of Nigeria
(CBN) has stipulated that individuals or entities selling the equivalent of
$10,000 or more to Bureau De Change (BDCs) must disclose the source of the
foreign exchange and adhere to all Anti-Money Laundering/Combating the
Financing of Terrorism/Counter Proliferation Financing (AML/CFT/CPF)
regulations, as well as foreign exchange laws and regulations.
Customers are permitted to
transfer foreign currencies from their personal domiciliary accounts held with
Nigerian banks to BDCs.
All digital or transfer
transactions for purchasing foreign currencies will be credited to the BDC’s
Nigerian domiciliary account, with payments made to customers’ Naira accounts.
For non-resident customers, whether Nigerian or foreign, a BDC may issue
prepaid NGN cards, subject to relevant maximum credit and cumulative limits in
accordance with Know Your Customer (KYC) requirements.
In the case of non-resident
customers, BDCs are instructed to issue prepaid Naira cards, subject to
applicable maximum credit and cumulative limits as per KYC requirements.
Beneficiaries of BTA or PTA of
$500 or less can receive the forex in cash. In the same vein, the financial
regulator said payments to customers for cash purchases of forex of the
equivalent of $500 and below may be made in cash.
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