In a bid to boost liquidity in the foreign exchange market and strengthen the naira, commercial banks will start selling dollars to Bureaux De Change (BDCs).
Sources said the move could lead to will require the banks to sell proceeds of international money transfers to BDCs at the Investors and Exporters (I&E) window rate who will in turn sell the foreign currencies to retail end-users.
A source said the BDC operators have been advising the CBN to revisit its 2016 model, which permitted the banks to sell dollars to BDCs. The, source, a BDC operator, spoke on condition of anonymity.
Ahead of possible implementation of the plan, the CBN last weekend, issued a circular to BDCs. The circular signed by CBN Director, Trade and Exchange Department, O.S Nnaji, titled: “Operational Mechanism for Bureau De Change Operations in Nigeria”, said the guidelines were to improve the efficiency of the forex market.
The apex bank pegged the spread on buying and selling by BDC operators within an allowable limit of -2.5 per cent to +2.5 per cent of the forex market window weighted average rate of the previous day.
“the mandatory rendition by BDC operators of the statutory periodic reports (daily, weekly, monthly, quarterly and yearly) on the Financial Institution Forex Rendition System (FIFX) which has been upgraded to meet individual operator’s requirements.”
The CBN stopped dollar sales to BDCs in July 2021, accusing the operators of carrying out illicit transactions. The apex bank also stopped issuing new licenses for BDCs and directed weekly dollar sales to commercial banks.
But, the banks failed to deliver on the responsibilities given to them, as many of the lenders were not selling dollar allocations to customers in need of forex.
The source claimed said that the adoption of the policy in 2016, was magical as the naira firmed up against the dollar and other global currencies.