Abuja, Nigeria – May 23, 2024: In a move aimed at restructuring the foreign exchange market, the Central Bank of Nigeria (CBN) has directed all Bureau de Change (BDC) operators in the country to reapply for new operational licenses. The CBN’s directive requires compliance by June 3, 2024, to continue participating in forex operations.
This announcement follows the introduction of revised Regulatory and Supervisory Guidelines for BDC Operations in Nigeria earlier this year. As part of these reforms, the CBN has set new minimum capital requirements: N2 billion for tier 1 BDC operators and N500 million for tier 2 operators.
The circular, signed by Haruna Mustafa, Director of the Financial Policy and Regulation Department at CBN, outlines comprehensive reforms intended to enhance the role of BDCs in Nigeria’s foreign exchange market. These reforms include:
- New Licensing Requirements: BDC operators must reapply for licenses under the newly established tier system.
- Revised Permissible Activities: The scope of activities BDCs can engage in has been updated.
- Enhanced Financial Requirements: Higher minimum capital thresholds have been established.
- Corporate Governance Standards: New standards have been introduced to improve the governance structures within BDCs.
- AML/CFT/CPF Provisions: Anti-Money Laundering (AML), Combating the Financing of Terrorism (CFT), and Combating the Financing of Proliferation (CPF) provisions have been strengthened.
To comply with these guidelines, existing BDCs must reapply for a new license under their chosen tier. They have six months from the effective date of the guidelines to meet the required capital for their selected tier. New applicants are also required to fulfill the conditions stipulated in the guidelines.
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BDC operators must submit specific details during the reapplication process, including the name of the promoter, the proposed name of the BDC, the promoter’s email address, and phone number. This streamlined process aims to ensure that all operators meet the necessary standards to foster a robust and transparent forex market.
According to the CBN, these latest directives are part of broader efforts to strengthen the Nigerian forex market, ensuring stability and efficiency. By setting higher capital requirements and introducing stringent regulatory measures, the CBN aims to mitigate risks and enhance the overall integrity of the forex market.
The reforms are expected to promote better corporate governance and compliance among BDC operators, thereby improving the operational environment and aligning it with international best practices.
As the deadline approaches, BDC operators are urged to align with the new requirements to avoid disruptions in their operations. The CBN remains committed to fostering a transparent and efficient forex market, crucial for Nigeria’s economic stability and growth.
For further details, BDC operators and applicants can refer to the revised Regulatory and Supervisory Guidelines for BDC Operations available on the CBN’s official website.
Contact Information:
Central Bank of Nigeria
Financial Policy and Regulation Department
Phone: +234-800-2255-226
Email: info@cbn.gov.ng
Website: www.cbn.gov.ng