CEM REPORT, FINANCE | The Central Bank of Nigeria (CBN) announced on Friday, March 1st, 2024, the revocation of operational licenses for a staggering 4,173 Bureaux De Change (BDC) operators across the country.
The CBN, through its acting Director of Corporate Communications, Sidi Ali Hakama, stated that the affected institutions failed to comply with various or at least one of the mandatory regulatory provisions.
“The affected BDCs failed to comply with the required payment of all necessary fees, including license renewal, within the stipulated period,” Hakama said. “Additionally, they failed to render their returns as per the guidelines and refused to adhere to directives, circulars, and regulations issued by the CBN, particularly those concerning Anti-Money Laundering (AML), Countering the Financing of Terrorism (CFT), and Counter Proliferation Financing (CPF).”
A full list of the operators whose licences where revoked is published on the CBN website.
The CBN highlighted this action as part of its efforts to restore confidence in the nation’s foreign exchange market.
The apex bank had also earlier announced the revision of regulatory guidelines for BDCs, including:
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Increased caution deposit requirements for Tier 2 BDC operators.
A mandate for BDCs to electronically transfer at least 75% of foreign currency sales to customers’ Nigerian domiciliary accounts or prepaid cards.
Stricter regulations against using unauthorized accounts for transactions, potentially leading to license revocation.
The CBN’s decision to revoke licenses and introduce stricter regulations has generated mixed reactions. While some see it as a necessary step to address non-compliance and improve transparency in the foreign exchange market, others are concerned about the potential impact on legitimate BDC operators and the wider business community.
It remains to be seen how these developments will play out in the long term. The revised guidelines aim to promote a more robust and compliant foreign exchange market, but their effectiveness will depend on successful implementation and enforcement by the CBN.
