Bureau De Change Operators to Re-apply for License as CBN Issues New Guidelines

The Central Bank of Nigeria, CBN, has updated the revised operational guidelines it handed down to Bureau De Change operators in Nigeria in February as “part of the reforms to re-position the …sub-sector to play its envisioned role in the foreign exchange market in Nigeria.”

In a circular dated Wednesday, May 22, 2024, with reference number FPIRD/DIR/PUB/CIR/002/010, signed by Haruna B. Mustafa, Director, Financial Policy and Regulation Department, the apex bank effected some changes in the draft guidelines and directed existing BDCs to reapply for new licence.

The bank said it reached the decision to effect the changes after due consultations with stakeholders in the sub-sector.

Said the CBN: “All existing BDCs and promoters of proposed BDCs are to note the following: Re-apply for a new license according to any of the Tiers or license category of their choice as provided in the Guidelines.”

One of the changes in the guidelines that will send operator reeling with joy is the immediate removal of the mandatory caution deposit of N200 million for tier-1 licence holders as well as the nullification of the N50 million deposit for tier-2 licence holders.

That is not all. The Central Bank also withdrew the non-refundable annual licence renewal fee of N5 million and N1 million for tier-1 and tier-2 BDCs, respectively.

The 44-page revised document, titled: Financial Policy and Regulation Department, May 2024, also stipulates the revised permissible non-permissible activities by the potential licencee, sourcing of foreign currencies, sales of foreign currencies, financial requirements from potential licencee, corporate governance requirements and AML/CFT/CPF provisions for BDCs.

“As part of reforms to re-position the Bureau De Change (BDC) sub-sector to play its envisioned role in the foreign exchange market in Nigeria, the Central Bank of Nigeria (CBN) issued the Draft Operational Guidelines for BDC Operations in Nigeria in February 2024, for stakeholder comments/inputs,” the statement said

“Following the conclusion of the stakeholder consultations and in exercise of the powers conferred on it by Section 56 of the Banks and Other Financial Institutions Act (BOFIA) 2020, the CBN hereby issues the attached Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria 2024 for compliance by all operators and promoters of proposed BDCs in Nigeria.”

The guidelines take effect from June 3, 2024.