These steps helped marginally reduce the headline inflation rate from 15.5% at the end of 2025 to 15.06% by February 2026.

External reserves also moved higher, while the gap between official and parallel exchange rates reduced to a good point.

Here is a look at ten of the most important moves, based on official announcements and reports from that period.

1. Banking Recapitalisation: 32 Banks Meet New Capital Rules Before Deadline

On March 27, 2026, CBN Governor Olayemi Cardoso said 32 banks had already met the revised minimum capital requirements set in March 2024. The deadline is March 31, 2026.

International commercial banks were required to raise ₦500 billion, national commercial banks ₦200 billion, regional banks ₦50 billion, and non-interest banks between ₦10 billion and ₦20 billion.

Banks that met the targets included Access Bank Plc, Zenith Bank Plc, First HoldCo Plc (First Bank), Guaranty Trust Holding Company (GTCO), United Bank for Africa Plc, Fidelity Bank Plc, FCMB Group Plc, Stanbic IBTC Holdings, Wema Bank Plc, and Ecobank Nigeria.

Others were Sterling Financial Holdings, PremiumTrust Bank, Standard Chartered Bank Nigeria, Citibank Nigeria, Globus Bank, Providus Bank (with its merger partner), Jaiz Bank, Lotus Bank, and TAJ Bank.

Also on the list were The Alternative Bank, Parallax Bank, Signature Bank, SunTrust Bank Nigeria, Alpha Morgan Bank, Nova Bank, Tatum Bank, as well as merchant banks such as FSDH Merchant Bank, Greenwich Merchant Bank, Rand Merchant Bank Nigeria, Quest Merchant Bank and Coronation Merchant Bank.

Together, they raised over ₦4.6 trillion in new capital, with a significant share coming from foreign investors.

The CBN said this strengthened the banking system and improved its capacity to support larger investments. The exercise also came with tighter rules on insider lending and non-performing loans.

2. New Cash Withdrawal Policies Took Effect from January 1

A circular issued in late 2025 changed how Nigerians handle physical cash. From the start of 2026, limits and extra charges on cash deposits into bank accounts were removed.

However, weekly withdrawal limits were introduced, ₦500,000 for individuals and ₦5 million for companies, across channels such as branches, ATMs and POS.

Withdrawals above these limits attract charges of 3% for individuals and 5% for corporates. Daily ATM withdrawals remain capped at ₦100,000 per customer.

The policy aims to reduce the risks and cost of handling large cash volumes while encouraging electronic payments. Banks and customers have since adjusted, with reports indicating increased digital transaction volumes in the first quarter.

3. Bureau de Change Operators Return to Official FX Market

On February 10, 2026, the CBN issued a circular allowing licensed Bureau de Change operators to resume purchasing foreign exchange from the Nigerian Foreign Exchange Market.

They had been excluded since 2021. Under the new arrangement, each BDC can access up to $150,000 weekly through authorised dealer banks at market rates, subject to strict reporting requirements.

The move is intended to improve retail access to foreign currency, ease pressure on the parallel market and support small businesses and individuals. Early signs showed a narrowing gap between official and street rates following the policy.

4. Addendum to BVN and Watch-List Rules Issued

A circular dated March 12, 2026, updated the Bank Verification Number framework. Banks must now place any BVN linked to suspected fraud on a temporary 24-hour watch-list. During this period, the account holder is notified and allowed to respond.

The addendum also sets 18 as the minimum age for BVN enrolment and permits only one lifetime change of the phone number linked to a BVN.

These changes, which take full effect from May 2026, are aimed at strengthening fraud detection while protecting legitimate users.

The CBN said improved real-time monitoring would help reduce losses from suspicious transactions.

5. Guidelines on Automated Anti-Money Laundering Systems

In early March, the CBN introduced minimum technology standards for detecting money laundering and terrorism financing. Deposit money banks have 18 months to comply, while other financial institutions have 24 months.

The guidelines require real-time screening, risk scoring and direct integration with watch-lists. Officials say the move shifts compliance from manual checks to automated systems, strengthening oversight over time.

6. Short-Term Relief on Expired NAFDAC Licences for Imports

At the end of January, the CBN allowed importers a two-month window to use NAFDAC product licences that expired at the end of 2025 when processing Form M on the single window platform.

The relief, which lasted until February 28, covered items such as medicines and packaged foods. It helped prevent supply disruptions while regulatory records were updated.

The measure was temporary and targeted, reflecting the CBN’s readiness to ease pressure on supply chains when necessary.

7. Updated Penalties for Dishonoured Cheques

A February circular strengthened sanctions on customers and banks involved in issuing or clearing dishonoured cheques. Administrative fines were increased, and repeat offenders risk restrictions on issuing new cheques.

The revision is aimed at improving trust in the cheque system while encouraging a faster shift to electronic payments. Clearing houses have since tightened monitoring of return rates.

8. MPC Cuts Monetary Policy Rate

The Monetary Policy Committee held its 304th meeting on February 23 and 24, 2026, and reduced the Monetary Policy Rate by 50 basis points to 26.5%.

The cash reserve ratio remained at 45% for deposit money banks and 16% for merchant banks, with 75% on non-TSA public sector funds.

The policy corridor was left unchanged. Governor Cardoso said the modest rate cut reflected easing inflation while maintaining a cautious stance. Markets reacted calmly, with some easing in fixed-income yields.

9. Diaspora Remittances: Naira-Only Payout Policy

In March 2026, the CBN directed all International Money Transfer Operators (IMTOs) to pay out remittances solely in naira.

Under the policy, recipients no longer receive foreign currency over the counter. Instead, IMTOs are required to settle payments through naira accounts with Nigerian banks.

The move is designed to channel foreign exchange inflows into the official market, improve liquidity and support exchange rate stability without drawing down external reserves.

10. CBN Reaffirms Oversight of Union Bank

Towards the end of March, following a court ruling on ownership matters, the CBN issued a statement reaffirming its supervisory role over Union Bank.

The regulator confirmed the bank had met recapitalisation requirements and remained fully operational. The clarification helped calm depositors and prevent wider concerns across the banking sector.

These ten policies worked together through the first quarter. Stronger bank capital, tighter controls on cash and fraud, improved FX access for retail users and a modest easing of interest rates all pointed in the same direction, focused on a more stable and modern financial system.

Inflation eased slightly, reserves improved and confidence in the naira strengthened in some areas. The key question now is whether these measures will translate into increased lending to businesses and sustained economic growth through the rest of 2026.

For the CBN, the first quarter was focused on building resilience first, then supporting expansion.

As the nation grapples with economic hardship and the shrinking of the middle-class, it has become imperative to explore untapped opportunities.

Whether it is leveraging the booming real estate sector, or investing in emerging technologies through innovative companies, there are practical ways to build wealth and achieve financial independence amidst these challenges.

Here’s how you can grow your income in Nigeria today:

1.   Treasury Bills (T-Bills):

Risk level: Low

Potential returns: 2 – 15%

Treasury bills are short-term debt instruments issued by the Federal Government of Nigeria through the Central Bank of Nigeria (CBN).

T-bill is typically lending money to the government for a short period of time, it could be 91 days, 182 days or 364 days, and earning profit on it through the discount issued.

For instance, you buy a treasury bills of N1,000,000 with a maturity period of 91 days at a discount rate, you will pay less than N1,000,000 (e.g, N975,000). At the end of the 91 days, you will receive the full N1,000,000, earning a profit of N25,000.

Why invest in treasury bills?

Short-term investment: The maturities range from 91 days, to 364 days.

Low risk: T-bills are backed by the Nigerian government, making them risk-free.

Discounted Purchase: T-bills are issued at a discount, and the difference between the purchase price and the face value is the profit.

Fixed returns: The returns are already determined during purchase and not affected by market fluctuations.

How to invest in treasury bills

Open a CSCS account: You need to open a Central Securities Clearing System (CSCS) account and bank account to trade treasury bills.

Choose a stockbroker: Research and select a licensed broker. Most commercial banks and brokers facilitate T-bill purchase.

Participate in the Auction: Select T-bills according to your financial goals from the available investment options

2. Bonds:

Risk level: Low to medium

Potential returns: 10 – 15% annually

Bonds are fixed-income securities that involve lending money to a borrower (government or company), in exchange for periodic interest payments and repayment of the principal amount at the end of the bond’s term.

Why invest in bonds:

Steady income: Bonds pay regular interest, providing a predictable and steady income flow.

Low risk: Government bonds are one of the safest investments as it is backed by the government.

Capital preservation: Your capital is returned at the end of the bond term, without default.

How to invest in bonds

Choose a bond type: The Federal government of Nigeria bonds are known for safety, while corporate bonds could provide higher returns, choose base on your goal and risk level.

Open a CSCS account: The Central Securities Clearing System (CSCS) account can be opened through a broker or financial institution.

Find a broker: Research and select a licensed broker.

Invest in bonds: You can invest in FGN bonds through participation in monthly auctions via the Debt Management Office, or buy from the secondary market.

3. Mutual Funds:

Risk Level: Low to medium

Potential returns : 5% to 25% annually depending on fund type

Mutual fund is a group investment where professionals gather a pool of funds from many investors and invest it in different financial assets like stocks, bonds, treasury bills, or bonds, depending on the fund’s goal and it is managed by a professional fund manager.

It is just like teaming up with others to invest, with an expert guiding where the money goes.

Why invest in mutual funds?

Affordability: Investment in mutual funds does not necessarily require large sum as some mutual funds allow investments as low as N5,000

Liquidity: It is relatively easy to withdraw funds when needed.

Professional Management and Diversification: It is managed by a professional and the funds are spread across different assets, reducing the risk of losing all.

How to Invest in Mutual Funds?

Understand your goals: Are you saving for school fees, retirement or a short-term project choose mutual funds that align with your goal.

Select funds according to your risk level: Compare funds based on performance, fees, and risk levels.

Register with trusted asset managers.

Monitor your investments: Keep track of funds performance, though it may grow slowly over time.

4. Dollar-Denominated Investment:

Risk level: Low to medium

Potential returns: 7 – 20% annually

Investing in dollar-denominated investment provides a hedge against naira depreciation, as its value is tied to the dollar.

Examples of dollar-denominated investments are eurobonds ( these are bonds issued in foreign currencies, especially the U.S dollar), dollar mutual funds, U.S stocks and assets.

These investments allow Nigerians to earn returns in U.S dollars, offering a reliable way to grow wealth in a volatile economy.

Why invest in dollar-denominated investments:

Hedge against naira depreciation: It protects your investment against naira depreciation.

High returns: Some dollar investments offer higher returns than naira-based investments.

Access to the global market: It provides access to international markets and opportunities.

How to invest in dollar-denominated asset

Open a dollar account: You can use a domiciliary account or licensed fintech apps.

Choose investment type: Decide between eurobonds, stocks, mutual funds, or real estate based on your goals and risk intolerance.

Fund your account in dollars: Change naira to dollars through your bank or Bureau De Change (BDC).

Invest: Buy assets of your choice.

5. Stocks:

Risk Level: Medium to high

Potential returns: 10 – 50% annually

Investing in stocks, also called shares or equities, means buying a portion of ownership in a company. For instance, a company has 100,000 shares and you own 1,000 shares, that means you have 1% ownership in the company.

As the company you invest in grows, your investment appreciates. It is important to note that the stock market can be highly volatile, therefore, if the shares of the company falls, your investment shrinks.

Why invest in stocks?

Aside from capital appreciation, you can also make money from the stocks you own through dividends and bonus shares, without selling the shares.

Some companies pay part of their profits to shareholders at the end of the financial year or interim dividend.

While some companies could decide to reinvest part of their profit to create new shares and then reward shareholders with these extra shares as bonus.

Also, stocks have higher growth potential compared to savings or fixed deposits.

How to invest in stocks

Choose a stockbroker: Research and select a licensed broker

Open a CSCS account: This is a Central Securities Clearing System account.  Investors have to be registered on the CSCS to participate in the Nigeria Stock Exchange.

Research and Invest in companies: Understand the financial performance and prospects of companies you want to invest in.

Monitor your investment: The Nigerian Exchange Group and stockbrokers on companies provide information valuable for tracking a stock’s performance.

This was announced on Wednesday in a circular issued by the apex bank, which was signed by Haruna Mustafa, the director of the Financial Policy and Regulation Department.

The CBN noted that those adjustments aimed to streamline BDC operations and enhance financial accessibility.

The apex bank noted that the BDCs were expected to adhere to corporate governance requirements and anti-money laundering, counter-terrorism financing, and counter-proliferation financing provisions.

The latest circular comes a day after the Monetary Policy Committee of the apex bank raised the benchmark lending rate to 26.25 per cent to tackle the country’s soaring inflation.

Reacting to the development, Aminu Gwadebe, the president of the Association of Bureau de Change Operators of Nigeria, said:

“The requirement is huge. It is not in line with global practices. Capitalisation in the UK is 50,000 pounds; in Kenya, it is $50,000 and so on. I don’t think it reflects global practice. A BDC is not a deposit taker; it is only buying and selling.

“Also, I’m afraid, we would not go the way of Algeria when they came with such policies and at the end of the day, every other player runs to the open market operations and at the end of the day, Algeria had to look for that open market to even determine their local currency exchange rate. We should be careful so that we will not throw away our experience, capacity and investment,” he warned.

According to the ABCON president, the deadline given to BDCs is short.

“When you are giving other sectors, one year, or two years, why the rush with the sub-sector? The deadline is quite short. It is not feasible and then we should also guide against what we are trying to avoid.  The CBN in its mind is checkmating money laundering and we may meet money laundering in the future,” he argued.

According to the new CBN rules, BDCs in the Tier 1 category would be required to have a minimum capital requirement of N2bn, pay N1m as a non-refundable application fee and N5m as a non-refundable licence fee.

The apex bank disclosed that Tier 2 BDCs would be required to have a minimum capital base of N500m, N0.25m as a non-refundable application fee and N2m as a non-refundable licence fee.

The new rules allow BDCs to participate in the Nigerian foreign exchange market as a dealer, following application and approval to the director of the Trade & Exchange Department for an authorised dealership licence.

The CBN said while BDCs could source dollars from individuals, adding, “Sellers of the equivalent of $10,000 and above to a BDC are required to declare the source of the foreign exchange and comply with all AML/CFT/CPF regulations and foreign exchange laws and regulations and customers may sell foreign currencies in their individual domiciliary accounts with Nigerian banks to BDCs. All such sales shall be credited to the BDC’s Nigerian domiciliary account.

“Every BDC shall conspicuously display its buying and selling rates. Such rates shall apply throughout all its branches, and where applicable, its franchisees. Disclaimers or statements by a BDC to the effect that an exchange rate indication is not to be relied on are prohibited. i. A BDC shall not give customers price indications which are misleading or make price comparisons which are not genuine or fair. Every BDC shall maintain adequate records of all its transactions for transparency and compliance with CBN Guidelines, AML/CFT/CPF provisions, circulars or directives,” part of the guidelines stated.

In terms of prudential requirements, the CBN said,

“BDCs are required to observe the following prudential requirements:  Net Open Position (NOP) limit in foreign currency of the equivalent of 30 per cent of its shareholders’ funds unimpaired by losses or as may be determined by the CBN from time to time. Limit total borrowing to 50 per cent of shareholders’ funds unimpaired by losses and maintain insurance cover over cash (both naira and foreign currency) in office and in transit, fire, and staff fidelity.”

(Source: Punch Online)

This was announced on Wednesday in a circular issued by the apex bank, which was signed by Haruna Mustafa, the director of the Financial Policy and Regulation Department.

The CBN noted that those adjustments aimed to streamline BDC operations and enhance financial accessibility.

The apex bank noted that the BDCs were expected to adhere to corporate governance requirements and anti-money laundering, counter-terrorism financing, and counter-proliferation financing provisions.

The latest circular comes a day after the Monetary Policy Committee of the apex bank raised the benchmark lending rate to 26.25 per cent to tackle the country’s soaring inflation.

Reading the communiqué of the meeting, Olayemi Cardoso, the Governor of the CBN, said,

“Members further observed the recent volatility in the foreign exchange market, attributing this seasonal demand, a reflection of the interplay between demand and supply freely functioning market system.”

The naira has depreciated significantly since the CBN unified the country’s exchange rates, trading between 1,400/$ and 1,600/$ at the official and parallel markets in the last two weeks.

The new guidelines, which are an update on the draft that was exposed earlier in the year, go into effect on June 3.

The CBN removed the mandatory caution deposit, which the industry players had kicked against.

CBN set up two new categories; Tier 1 and Tier 2 BDC licences

According to the new guidelines,  A Tier 1 BDC:

1. May operate in any State of the Federation and the Federal Capital Territory,
2. May establish branches and appoint franchisees in any state and FCT, subject to the written approval of the CBN.
3. Shall maintain a minimum distance of one kilometre between its branches, its branch and a franchisee, and between its franchisees.
4. Shall exercise oversight on its franchisees. All franchisees shall adopt their franchisor’s name, logo, branding, technology platform and regulatory rendition requirements.

2 Classified as Confidential: e. Shall comply with the franchising standards prescribed in this guidelines.

A tier 2 BDC Licence allows the operator to operate from only one state of the federation or the FCT, and it is allowed to establish five branches in a state of operation, subject to the written approval of the CBN.

It is also required to maintain a minimum distance of one kilometre between its branches and is not allowed to appoint franchisees.

The BDCs (existing or new) would also be required to meet the capital requirements for their license category within six months.

The apex bank said it is set to sell $10,000 to each BDCs at N1101/$ and directed the operators to sell at a spread not more than 1.5 per cent above the CBN rate.

Before now, the  Association of Bureau De Change Operators of Nigeria (ABCON) has appealed to the Central Bank of Nigeria (CBN) to adjust and lower its applicable exchange rate downward below the N1,251/$ it pegged for the Bureau De Change (BDC) operators, as it has become expensive.

The request by the BDCs is coming amid historic development where for the first time in 15 years, the parallel market rate of N1,235/$ is lower than the official rate of N1252/$, which is the applicable buying exchange rate for the BDCs.

This was made known in a letter signed by the ABCON President, Aminu Gwadabe, to the Director, Trade and Exchange Department.

The association, which is an umbrella body for CBN-licensed BDC operators, insisted that the naira’s speedy recovery, which was faster than expected, had made CBN’s selling rate to BDCs very expensive and difficult to offload to retail end buyers that are trooping to the undocumented forex operators for cheaper rates and avoiding our services.

ABCON further expressed concerns that many BDCs who funded their accounts for dollar allocations are yet to receive their allocation of dollars to meet the legitimate critical demand of their clients.

The body lamented that this was due to the scrutinization of the BDCs’ documents for collection at the various designated Centers which invariably made the BDCs vulnerable to exchange rate risk and significant losses.

The association insisted that with the naira appreciating across markets, many BDCs who bought dollars at N1,251/$ will lose significant income and capital if they sell at the current open market rate of N1,235/$.

It, therefore, highlighted the need for the call for a further review downward of the applicable exchange rate for the period and subsequently to continue to enhance naira sovereignty.

The statement partly reads,

“We discovered a worrisome development where many of our members who paid for dollar allocations at N1,251/$ with a margin of 1.5% are yet to receive their disbursement. This is happening in the face of the prevailing open market rate of N1,235/$ which is lower than the authorized applicable exchange rate by the CBN to the BDCs.’’

Despite this development, ABCON lauded the CBN leadership for the recall of BDCs into the official FX window and steps taken by the apex bank to strengthen the naira against the dollar and other global currencies.

ABCON said the positive fallout of the CBN’s efforts to restore naira’s glory came faster than expected, reiterating its commitment to working with the apex bank to realize the objectives of the government towards exchange rate stability and economic growth.

ABCON states that their forecasts in the ongoing market development indicate a willingness of the market to correct itself with a realistic price discovery as naira is predicted to continue to appreciate further across all markets with the increasing sources of foreign exchange inflows aided by the CBN policies.

It said, “It is in view of the above market developments that we write to appeal to your good selves for a readjustment and review downwards of our funding rate of the last tranche (2nd bidding) from N1,251/$ further down to reflect the current market rate discovery. This became imperative as it is only the consideration of the readjustment downward that will enable our members to upload their holding positions.’’

ABCON also requested that the process of payments at the various disbursement centers be reviewed in the immediate time to a medium time automation to achieve enhanced timely payments while also observing the spot nature of our transactions.

The association further requested that based on the offer and acceptance rule, the approval of refunds to those who are yet to collect disbursement having funded their accounts as it is the market that determines the rate presently be considered going forward.

ABCON also requested that the apex bank introduce a cut-off time for payments and collection of bids, adding that the current open-ended system for payments and collection of bids does not make for effective administration and control of the process.

It said, “Consequently, many of our members are jittery to bid/collect their bid for fear of losing money as the current market reality has the potential to force us to sell below cost price and antithetical to recent market price discovery.’’

ABCON insisted that the disturbing exchange rate disparity can be addressed by a quick and decisive response of the apex bank, which will go a long way in bolstering BDC operators’ confidence in the ongoing intervention by the Central Bank of Nigeria as well as enhance their participation in the bidding process.

This was contained in a circular signed by Dr Hassan Mahmud, the bank’s director, Trade and Exchange Department, and made available to the Journalist, Monday.

The apex bank directed each BDC to sell the dollars to eligible customers at a rate not exceeding 1.5 percent above the purchase price, implying the BDCs are not expected to sell above N1,269/$1.

Recall that on July 27, 2021, the CBN discontinued the sale of foreign exchange to BDCs, accusing them of trading FX wholesale amounts greater than $5,000, in contravention of their licenses, and Nigeria’s FX regulations.

The  Central Bank of Nigeria (CBN),  announced its decision to sell foreign exchange worth $20,000 to each eligible BDCs across the country in February.

This comes more than two years after the suspended Godwin Emefiele, former CBN Governor, stopped the sales of foreign exchange to BDC operators.

However, the naira maintained a steady appreciation against the United States dollar on Monday, gaining N14 to close at 1,408/$ at the official market.

The circular read in part, “We refer to our letter to you referenced TED/DIR/CON/GOM/001/071 in respect of the above subject, wherein the CB approved a second tranche of the sale of FX to eligible BDCs.

“We write to inform you of the sale of $10,000 to each BDC at the rate of N1,251/$1. The BDCs are to sell to eligible end users at a spread of not more than 1.5 per cent above the purchase price.”

Last month, Olayemi Cardoso, the CBN Governor, outlined a comprehensive strategy aimed at curbing inflation, stabilising the exchange rate, and instilling confidence in the country’s banking system and economy.

Through last month’s Monetary Policy Committee meeting and a conference call with foreign portfolio investors, the central bank set expectations for sustained growth in the country’s foreign currency reserves and improved liquidity in the foreign exchange market.

“All the different measures we have taken to boost reserves and create more liquidity in the markets have started to pay off,” Cardoso said.

A statement issued this Friday evening, March 1, 2024 said the action is “in exercise of the powers conferred on it under the Bank and Other Financial Institutions Act (BOFIA) 2020, Act No. 5, and the Revised Operational Guidelines for Bureaux De Change 2015 (the Guidelines)”.

Signed by Sidi Ali, Hakama (Mrs.), acting director, Corporate Communications, CBN, the statement said that the affected institutions failed to observe at least one of the following regulatory provisions:

1. Payment of all necessary fees, including licence renewal, within the stipulated period in line with the Guidelines.
2. Rendition of returns in line with the Guidelines.
3. Compliance with guidelines, directives and circulars of the CBN, particularly Anti-Money Laundering (AML), countering the Financing of Terrorism (CFT) and Counter-Proliferation Financing (CPF) regulations.

The CBN is revising the regulatory and supervisory guidelines for Bureau de Change operations in Nigeria. Compliance with the new requirements will be mandatory for all stakeholders in the sector when the revised guidelines become effective.

“Members of the public are hereby advised to take note and be guided accordingly,” CBN said, adding that the list of affected BDC operators is available on the Bank’s website.

1. Lagos: 2,958
2. Abuja: 1,179
3. Kano: 981
4. Anambra: 259
5. Kaduna: 55
6. Abia: 50
7. Oyo: 32
8. Enugu: 25
9. Rivers: 24
10. Delta: 21
11. Sokoto: 18
12. Imo: 15
13. Edo: 14
14. Borno: 11
15. Bauchi: 7
16. Kwara: 7
17. Plateau: 6
18. Ebonyi: 4
19. Kebbi: 4
20. Niger: 3
21. Ogun: 3
22. Katsina: 3
23. Akwa Ibom: 2
24. Cross River: 2
25. Gombe: 2
26. Kogi: 2
27. Bayelsa: 1
28. Benue: 1
29. Nasarawa: 1

Total: 5,690

CBN resumes forex sale to BDC operators after three years

The Central Bank of Nigeria has announced its decision to sell foreign exchange worth $20,000 to each eligible Bureau De Change operator (BDCs) across the country.

The development came three years after the apex bank announced the suspension of foreign exchange sales to BDC operators.

The apex bank disclosed this in a new circular issued and signed by Hassan Mahmud, the director, Trade and Exchange Department, on Tuesday.

According to data obtained from the CBN website, there are 5,690 BDC operators nationwide.

However, about 1,373 BDC operators have been screened to get the allocation. The breakdown include Abuja, 186; Awka,  26; Kano, 376; Lagos, 785.

On July 27, 2021, the CBN discontinued the sale of foreign exchange to BDCs accusing them of trading FX wholesale that amounts greater than USD 5000, in contravention of their licences, and Nigeria’s FX regulations.

The former CBN governor then said the BDCs had deviated from the objectives they were set up and had become agents facilitating graft and corruption in the country.

The latest circular, approving sale of forex to the BDC operators was titled, “Sale of Foreign Exchange to Bureau de Change Operators to meet retail demand for eligible invisible transactions.”

It noted that the move aimed at rectifying the persisting distortions in the retail segment of Nigeria’s foreign exchange market and bridge the widening gap in the exchange rate.

It said the allocation would  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 read, “Following the ongoing reforms in the foreign exchange market, aimed at achieving an appropriate market-determined exchange rate for the Naira, the Central Bank of Nigeria has observed the continued price distortions at the retail end of the market, which is feeding into the parallel market and further widening the exchange rate premium.

“To this end, the CBN has approved the sale of foreign exchange to eligible Bureau De Change to meet the demand for invisible transactions. The sum of $20,000 is to be sold to each BDC at the rate of N1,301/$- (representing the lower band rate of executed spot transactions at NAFEM for the previous trading day, as of today, 27th February 2024).

“All BDCs are allowed to sell to end-users at a margin NOT MORE THAN one per cent (1 per cent) above the purchase rate from CBN.”

CBN’s admittance following a series of complaints by some bank customers on the scarcity of naira notes at the counters, Automated Teller Machines (ATMs), Points of Sale (PoS), and Bureaux de Change (BDCs).

In a statement issued by the Corporate Communications Department of the CBN, the apex bank said the seeming currency scarcity was occasioned by large volume withdrawals of cash from various CBN branches by Deposit Money Banks (DMBs).

It stated that panic withdrawals by bank customers were also partly responsible for the seeming scarcity.

The CBN said there is no shortage of naira notes, noting that there is an adequate supply of the currency in the economy.

“The attention of the CBN has been drawn to reports of alleged scarcity of cash at banks, ATMs, PoS and BDCs in some major cities across the country.

“Our findings reveal that the seeming cash scarcity in some locations is due largely to high volume withdrawals from the CBN branches by DMBs and panic withdrawals by customers from the ATMs.

“While we note the concerns of Nigerians on the availability of cash for financial transactions, we wish to assure the public that there is sufficient stock of currency notes for economic activities in the country.

“The branches of the CBN across the country are also working to ensure the seamless circulation of cash in their respective states of operation,” it said.

Reports circulating on social media indicate that the apex bank has unbanned the sale of forex to the BDCs more than two years after Godwin Emefiele, the suspended CBN governor, announced the suspension of foreign exchange sales to BDC operators in that segment of the market.

Under the new framework, as speculated, the spread on buying and selling by BDC operators is set to fall within a permissible range of -2.5% to +2.5% of the Nigerian foreign exchange market window’s weighted average rate from the previous day.

But the CBN has come out to deny the report of fresh guidelines, noting that the said document was from its release on February 20, 2017. See the tweet from the CBN:

[Featured Image Credit]