Only 210 BDCs meet CBN’s forex requirement on KYC

Fresh facts emerged over the weekend that out of a total of 2,990 registered Bureaux De Changes (BDCs) in Nigeria, about 2,780 failed to meet the foreign exchange requirement on Know Your Customer

(KYC) stipulated by the Central Bank of Nigeria (CBN) leaving only 210 BDCs eligible to access foreign exchange.

Currency dealers explained that the situation in the market may have been part of the reason Banks begun intensive scramble for the few eligible Bureaux De Change accounts after their efforts to stop the operators from accessing the Diaspora-related foreign exchange (Forex) failed.

Meanwhile, in the just concluded week, the Nigerian foreign exchange market witnessed sustained depreciation of the naira against the US dollar at both the interbank market and Bureau De Change  market segments.

The Central Bank of Nigeria last week increased the weekly dollar supply to BDC operators by licensed banks from 30,000 dollars to 50,000 dollars. The bank said that the increase was necessary based on the present prevailing circumstances where the available Forex in the market was not sufficient to meet the needs of Nigerians.

The CBN had recently issued a circular directing that banks that are agents to International Money Transfers Operators (IMTSO) should sell foreign currency to the tune of $30, 000 per week to licensed BDC operators.

The bankers committee revealed that before the increase was made, there were lots of consultations by the CBN and the Committee based on the feedback received from the market which necessitated the increase.

The issue of making Forex available to Nigerians has been very topical and CBN has been working very hard to address this. This development the committee believes will ensure that there is more cash available to the BDCs and increase the supply and this will help to drive down the price.

“The reason for this decision is to ensure that people get enough for school fees, student allowance and personal travel allowance and any BDC that tries to circumvent this gesture will be severely punished,’’ said Kennedy Uzoka ,Group Managing Director and Chief Executive Officer of the United Bank for Africa (UBA) Plc., told journalists at the end of bankers’ committee meeting.