Forex

Nigerian Bureau De Change Operators Weigh Merger Options Amidst CBN Regulations

Published

3 months ago

February 26, 2024

As the Central Bank of Nigeria (CBN) proposes new regulatory guidelines for Bureau De Change (BDC) operators, Nigerian currency traders are contemplating mergers as a potential strategy to navigate the evolving regulatory landscape.

The proposed guidelines, outlined in a draft paper titled ‘Revised Regulatory And Supervisory Guidelines For Bureau De Change Operations In Nigeria,’ suggest significant increases in capital requirements for BDC operators, including a jump in share capital to N2 billion for Tier 1 licenses and N500 million for Tier 2 licenses.

Aminu Gwadebe, President of the Association of Bureau De Change of Nigeria (ABCON), highlighted the potential for consolidation within the industry as members grapple with the proposed regulatory changes.

Gwadebe explained the need for a temporary halt on issuing new licenses to allow existing operators to merge and form consolidated entities capable of meeting the stringent capital requirements.

Speaking with media Gwadebe noted that the proposed cautionary deposits, amounting to N200 million for Tier 1 and N50 million for Tier 2 licenses, were not in line with global practices for BDC operations.

He stressed the need for dialogue and review of the proposed figures, asserting that such high deposit requirements were unprecedented in the industry.

In anticipation of the CBN’s finalization of the regulatory guidelines, BDC operators are exploring various options to bolster their capital base.

Some operators have begun discussions about potential mergers to pool resources and meet the proposed capital thresholds, recognizing the challenges of raising substantial capital individually within a short timeframe.

As the regulatory landscape evolves, BDC operators are keenly observing developments and engaging in strategic deliberations to ensure compliance with regulatory requirements while sustaining their operations in Nigeria’s dynamic financial environment.

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Samed Olukoya

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Naira

Black Market Dollar to Naira Exchange Rate Today 13th May 2024

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 13th, 2024 stood at 1 USD to ₦1,500.

Published

10 hours ago

May 13, 2024

Samed Olukoya

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 13th, 2024 stood at 1 USD to ₦1,500.

Recent data from Bureau De Change (BDC) reveals that buyers in the Lagos Parallel Market purchased a dollar for ₦1,470 and sold it at ₦1,460 on Friday, May 10th, 2024.

This indicates a decline in the Naira exchange rate compared to the current rate.

The black market rate plays a crucial role for investors and participants, offering a real-time reflection of currency dynamics outside official or regulated exchange channels.

Monitoring these rates provides insights into the immediate value of the Naira against the dollar, guiding decision-making processes for individuals and businesses alike.

It’s important to note that while the black market offers valuable insights, the Central Bank of Nigeria (CBN) does not officially recognize its existence.

The CBN advises individuals engaging in forex transactions to utilize official banking channels, emphasizing the importance of compliance with regulatory frameworks.

How much is dollar to naira today in the black market

For those navigating the currency exchange landscape, here are the latest figures for the black market exchange rate:

Buying Rate: ₦1,500
Selling Rate: ₦1,480

As economic conditions continue to evolve, staying informed about currency exchange rates empowers individuals to make informed financial decisions. While the black market provides immediate insights, adherence to regulatory guidelines ensures stability and transparency in forex transactions.

Forex

Zimbabwe Implements Strict Rules: $14,782 Fine for Violating Official Exchange Rate

Published

3 days ago

May 10, 2024

Samed Olukoya

Zimbabwe, in a bid to stabilize its currency and clamp down on black-market trading, has introduced stringent regulations to penalize individuals and companies found violating the official exchange rate of its new currency, the ZiG.

Under the new rules announced by Finance Minister Mthuli Ncube, offenders will face a hefty fine of 200,000 ZiG or $14,782.

The move comes as the government seeks to enforce the sole use of the official exchange rate, which is determined daily by the Reserve Bank of Zimbabwe.

The decision to impose such a significant penalty underscores the seriousness with which Zimbabwean authorities are approaching the issue of currency stability.

By cracking down on those who flout the official exchange rate, the government aims to curb the proliferation of parallel markets and ensure the orderly functioning of the economy.

Previously, retailers were required to price their goods within 10% of the official exchange rate to prevent excessive profiteering.

However, this regulation has now been scrapped as it was deemed ineffective in curbing informal trading and maintaining the value of the currency.

The ZiG, introduced on April 5 as a successor to the Zimbabwean dollar, represents the country’s sixth attempt to establish a stable local currency.

Backed by 2.5 tons of gold and approximately $100 million in foreign currency reserves held by the central bank, the ZiG is intended to restore confidence in the nation’s monetary system.

Despite these efforts, the ZiG has faced challenges since its launch, including fluctuations in its value against major currencies.

Trading at 13.53 to the dollar as of Thursday, the currency experienced a record low of 13.67 to the dollar earlier in the week, highlighting the volatility inherent in Zimbabwe’s currency market.

The introduction of strict penalties for violating the official exchange rate reflects Zimbabwe’s determination to maintain control over its currency and stabilize its economy.

However, it remains to be seen how effective these measures will be in addressing the underlying issues contributing to currency instability and informal trading in the country.

Naira

Black Market Dollar to Naira Exchange Rate Today 9th May 2024

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 9th, 2024 stood at 1 USD to ₦1,450.

Published

4 days ago

May 9, 2024

Samed Olukoya

The black market, also known as the parallel market or Aboki fx, US dollar to Nigerian Naira exchange rate as of May 9th, 2024 stood at 1 USD to ₦1,450.

Recent data from Bureau De Change (BDC) reveals that buyers in the Lagos Parallel Market purchased a dollar for ₦1,440 and sold it at ₦1,430 on Wednesday, May 8th, 2024.

This indicates a decline in the Naira exchange rate compared to the current rate.

The black market rate plays a crucial role for investors and participants, offering a real-time reflection of currency dynamics outside official or regulated exchange channels.

Monitoring these rates provides insights into the immediate value of the Naira against the dollar, guiding decision-making processes for individuals and businesses alike.

It’s important to note that while the black market offers valuable insights, the Central Bank of Nigeria (CBN) does not officially recognize its existence.

The CBN advises individuals engaging in forex transactions to utilize official banking channels, emphasizing the importance of compliance with regulatory frameworks.