The Central Bank of Nigeria (CBN) has initiated a significant intervention by allocating $20,000 to each eligible Bureau De Change (BDC) operator across the country.
This proactive measure aims to bridge the widening gap in the exchange rate and promote a more market-driven system for the Naira.
Dr. Hassan Mahmud, the Director of the Trade & Exchange Department at the CBN, issued a circular outlining the details of the allocation.
Under the directive, each BDC will receive $20,000 to be sold at a fixed rate of N1,301 per dollar.
This rate mirrors the lower band rate of executed spot transactions at the Nigerian Autonomous Foreign Exchange Market (NAFEM) as of the previous trading day.
The initiative seeks to inject much-needed liquidity into the forex market, thereby stabilizing the value of the Naira and curbing pressures contributing to disparities in the parallel market.
Furthermore, the circular imposes guidelines on BDC operators, restricting them from selling foreign exchange to end-users at a margin exceeding one percent above their purchase rate from the CBN.
This safeguard is intended to prevent excessive mark-ups and protect consumers from price exploitation.
To ensure accountability and compliance, eligible BDCs must deposit their Naira payments into designated CBN Foreign Currency Deposit Naira Accounts and furnish necessary documentation for disbursement at select CBN branches in Abuja, Awka, Lagos, and Kano.
The CBN’s $20,000 allocation to BDCs represents a strategic intervention aimed at fostering stability and restoring confidence in Nigeria’s forex market amidst ongoing economic challenges.
