The Central Bank of Nigeria (CBN) has extended the temporary access granted to Bureau de Change (BDC) operators for purchasing foreign exchange from the Nigerian Foreign Exchange Market (NFEM) until May 30, 2025.
The extension, which was initially set to expire on January 31, 2025, aims to sustain liquidity in the retail forex market and stabilize exchange rate volatility.
The previous directive had granted temporary access to existing BDCs to source forex from authorized dealers but capped at $25,000 per BDC.
“We refer to our circular TED/FEM/PUB/FPC/001/030 dated December 19, 2024, which granted temporary access to existing BDCs to the NFEM for the purchase of FX from Authorized Dealers, subject to a weekly cap of USD25,000.00,” the circular read.
“The expiry date of January 31, 2025, which was granted in the above-mentioned circular, has been extended to May 30, 2025. All other terms and conditions in the above-mentioned circular remain unchanged. The CBN remains committed to a fully functional foreign exchange market and will continue to provide liquidity when necessary to manage price volatility.”
The extension comes at a critical time as Nigeria’s foreign exchange reserves fell by $1.11 billion or 2.72% in January 2025.
According to CBN data, the country’s reserves dropped from $40.88 billion on January 2 to $39.77 billion by January 30.
Analysts attribute the reserve depletion to CBN interventions in the forex market, external debt servicing obligations and capital outflows.
While the naira appreciated in the same period, the decline in reserves suggests that the CBN may have deployed part of its FX stockpile to stabilise the local currency and manage market liquidity.
By extending forex access to BDCs, the apex bank aims to enhance liquidity at the retail forex end and ensure that BDCs meet the demand for personal and business-related transactions.
The CBN has reiterated its commitment to maintaining a functional forex market while addressing concerns over speculation and currency volatility.