CBN threatens BDC crackdown as naira falls to 900/$

Bisola David
Bisola David
Naira plunges to record low against pounds

The naira lost value on the parallel market on Wednesday, ending the day at 900/dollar.

This happened just two weeks after the local currency was being sold on the black market for 960 dollars.

The naira’s upward trend in recent days was reversed as the black market once more experienced a shortage of dollars.

Earlier this week, the local currency fluctuated between 850 and 880 to the dollar.

The naira decreased on Wednesday to 773.42/$ in the Investor and Exporter window and in the parallel market. On Tuesday, the I&E Window’s local exchange rate had reached 757.10/$.

On Wednesday, bureau de change employees in Lagos, Kano, Abuja, and airports quoted the dollar between 895 and 905 per unit.

A BDC employee at the Lagos airport, Sanusi Ibrahim, The Punch “We bought and sold the naira today at 890/$ and N900/$.”

A BDC operator at Abuja’s Central Business District, Yusuf Kareem, also stated, “The dollar is still in short supply. Today, we sold for N900.”

The Central Bank of Nigeria threatened to remove the operating licenses of BDCs that disobeyed its regulations as the naira continued to resist efforts to stop its drop.

The president of the Association of Bureau De Change Operators of Nigeria, Aminu Gwadabe, confirmed this to The Punch following a BDC operator awareness-raising event.

The apex bank reiterated that by August 31, 2023, any operator who violates its circular on the allowable margin of -2.5 percent and +2.5 percent on the average weighted rate of I&E closing rate, rendition of returns, and payment of penalties, risks having their operating license revoked.

The operational framework enabling BDCs to trade foreign currency at rates comparable to those available on the Investor & Exporter forex window was unveiled by the top bank on Friday.

It issued the directive to BDCs in a circular titled “Operational mechanism for Bureau de Change operations in Nigeria” and dated August 17, 2023.

A part of it stated: “The spread on buying and selling by BDC operators shall be within an acceptable limit of -2.5% to +2.5% of the Nigerian currency market window weighted average rate of the preceding day.

“Mandatory rendition by BDC operators of the statutory periodic reports (daily, weekly, monthly, quarterly, and yearly), on the financial institution’s forex rendition system which has been upgraded to meet operators’ requirements.”

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