CBN approves sale of additional $10,000 each to 1,583 eligible BDCs

Mariam Abeeb

The Central Bank of Nigeria has approved the sale of an additional 10,000 each dollars to 1,583 eligible Bureaux De Change (BDCs) in the country to meet market demands.
The Director, Trade and Exchange Department of the CBN, Dr Hassan Mahmud, made this known in a letter addressed to the President, Association of Bureau De Change Operators of Nigeria (ABCON) in Abuja.
Mahmud said that the CBN would sell to the BDCs at the rate of N1, 021 to a dollar.
“The BDCs are in turn to sell to eligible end users at a spread of not more than 1.5 per cent above the purchase price,” he said.
He directed all eligible BDCs to commence payment of Naira deposit to some designated CBN Naira deposit account numbers.
“All BDCs are advised to continue to abide by the rules and conditions as stipulated in our earlier operational guidelines,” he said.
The approvas are part of CBN’s intervention in the foreign exchange market to improve liquidity and stabilise the Naira.
The Central Bank of Nigeria (CBN) has further reduced the foreign exchange (FX) rate for dollar allocations to bureau de change (BDC) operators.
On Tuesday, the CBN, in a circular signed by Hassan Mahmud, director, trade and exchange department, said it sold $10,000 at the rate of N1,021/$ to each BDCS.
The circular titled, ‘SALE OF FX TO BDCs TO MEET MARKET DEMAND (RETAIL-END) FOR INVISIBLE TRANSACTIONS’ was addressed to the president of the Association of Bureau De Change Operators of Nigeria (ABCON).
“The BDCs are in turn to sell to eligible end users at a spread of NOT MORE THAN 1.5 percent above the purchase price,” CBN said.
“ALL eligible BDCs are therefore directed to commerce payment of the Naira deposits to the underlisted CBN Naira Deposit Account Numbers from today, Monday April 22, 2024 and submit confirmation of payment, with other necessary documentations, for disbursement of FX at the respective CBN Branches.”
The announcement followed a denial by the CBN that it has reduced the rate for FX allocations to BDCs to N1,001/$1.
CBN has been selling FX to BDCs below the official and parallel market rates.
The latest discount comes at a period naira halted its appreciation in both FX markets, depreciating to N1,260 per dollar at the parallel section on April 22, from N1,230/$1 traded on April 19.
Within the same period, the naira depreciated to N1,234.49 against the dollar, from N1,169.99/$ at the official window.
On April 8, CBN sold FX to the BDCs at the rate of N1,101/$, compared to the N1,251/$ the apex bank offered to the parallel market operators on March 25 and the N1,301/$ announced on February 27.