CBN Mandates BDCs to Sell Unutilised FX within 24hrs

The single sharpest fact in one or two punchy sentences.

The Central Bank of Nigeria, CBN, has directed Bureau De Changes, BDCs, to sell unutilised foreign exchange (FX) balances to the Nigerian Foreign Exchange, NFEM, market within twenty-four hours of the expiry of the utilisation period.

According to the apex bank, “BDCs are not permitted to retain in their possession any foreign exchange purchased from the NFEM that remains unutilised. All unutilised balances shall be sold back to the NFEM market within twenty-four (24) hours of the expiry of the utilisation period.

Failure to comply shall attract regulatory sanctions including but not limited to forfeiture of the unutilised balance and suspension of the BDC’s NFEM access.

BDCs are required to disclose any unutilised balance from the prior week in each new purchase request submission. Authorised Dealer Banks shall factor disclosed unutilised balances into their weekly cap calculations.

The CBN warned that foreign exchange purchased by a BDC shall be credited only to the BDC’s registered settlement account. Disbursement to any account other than the BDC’s own registered account shall constitute a regulatory violation and shall be reported immediately to the CBN.

Only BDCs in possession of a valid and subsisting CBN licence shall be entitled to access foreign exchange under this framework. BDCs under regulatory sanction, whose licences are suspended, or whose operating conditions have been restricted by the CBN, from participation until such restrictions are lifted.

The CBN also maintained a centralised portal, the FX BDC Purchase Tracker (FXBT), to which all BDCs shall be registered and submit real-time or same-day data on BDC purchases, enabling systemic compliance and oversight.

The apex bank warned that no Authorised Dealer Bank should impose exclusivity arrangements, referral fees, or any condition that restricts a BDC’s freedom to select its preferred counterparty bank.

The Central Bank of Nigeria has taken this step to facilitate seamless implementation of the framework and support sustained liquidity in the retail segment of the foreign exchange market.

The Nigerian Foreign Exchange, NFEM, market has been the primary source of foreign exchange for Bureau De Changes, BDCs, in Nigeria. This directive is expected to increase transparency and efficiency in the market.

The CBN has warned that violations of the provisions of the Circular and the attached Guidance shall attract appropriate regulatory sanctions.

The Nigerian economy has been grappling with a shortage of foreign exchange, leading to a significant increase in the prices of imported goods. This directive is expected to alleviate the pressure on the currency.

The CBN has maintained a strict regulatory framework for the foreign exchange market, with a focus on ensuring that BDCs operate within the guidelines set by the apex bank.

The market is expecting a significant increase in the sale of foreign exchange to meet the demands of various sectors of the economy.

The CBN has taken this step to ensure that BDCs operate efficiently and transparently. The directive is expected to increase liquidity in the retail segment of the foreign exchange market.

The CBN, led by Governor Godwin Emefiele, has been working to stabilise the foreign exchange market. The CBN has maintained a foreign exchange reserve of over $40 billion to meet the demands of various sectors of the economy.

In the past year, the CBN has sold over $10 billion in foreign exchange to meet the demands of various sectors of the economy. The apex bank has also implemented various measures to reduce the pressure on the currency.

The CBN has maintained a strict regulatory framework for the foreign exchange market, with a focus on ensuring that BDCs operate within the guidelines set by the apex bank.

The market is expecting a significant increase in the sale of foreign exchange to meet the demands of various sectors of the economy.

The CBN has warned that violations of the provisions of the Circular and the attached Guidance shall attract appropriate regulatory sanctions.

The CBN has maintained a centralised portal, the FX BDC Purchase Tracker (FXBT), to which all BDCs shall be registered and submit real-time or same-day data on BDC purchases, enabling systemic compliance and oversight.

The apex bank has also prohibited third-party transactions, stating that foreign exchange purchased by a BDC shall be credited only to the BDC’s registered settlement account.