Enter your email address below and subscribe to our newsletter

Over 4,000 BDC Operating Licenses Revoked by CBN

By Oluchukwu Ikemefuna

Share your love

The Central Bank of Nigeria (CBN) on Friday annulled 4,173 bureaux de change (BDC) operator licences. This surprising action was disclosed in a statement by Hakama Sidi Ali, the spokesperson for CBN.

Central Bank of Nigeria

The impacted operators were said not to submit required paperwork, pay fees, or follow anti-money laundering and anti-terrorism financing laws. The regulatory and supervisory guidelines for Bureau de Change operations in Nigeria are being revised by the CBN. When the updated guidelines take effect, all parties involved in the industry will need to comply with the new requirements, according to the statement.

Actions Taken By The Central Bank Of Nigeria Over BDC Licence

The licenses were annulled just four days after the Central Bank changed its position on selling dollars to BDCs that qualified, which it had held for three years. Operators are required by the new regulations to link every transaction to an active bank verification number (BVN), engage in digital integration with the CBN, and hire external auditors.

The minimum capital requirements for BDCs were also raised by the Central Bank to N500 million for Tier 2 license holders and N2 billion for Tier 1 license holders.

Renowned capital market professor and president of the Association of Capital Market Academics of Nigeria, Uche Uwaleke, reacted to the development by applauding the decision as the best course of action for the stabilization of the forex market.


According to the former Imo State Finance Commissioner, the apex bank’s move will lessen market speculation and round-tripping.

“It’s a positive development,” he declared. “ and will lessen speculative attacks on the naira, help sanitize that area of the FX market, and facilitate the CBN’s oversight of the BDCs.”

The Affected List Of BDC Affected By Central Bank Of Nigeria Decision

The Central Bank of Nigeria (CBN) also stated that 4,173 Bureaux De Change Operators had their licences annulled based on the Revised Operational Guidelines for Bureaux De Change 2015 (the Guidelines) and the Bank and Other Financial Institutions Act (BOFIA) 2020, Act No. 5.

One can access the list of impacted BDC operators on the bank’s website, www.cbn.gov.ng. At least one of the following regulatory requirements was not followed by the BDC, which had their licence revoked:

payment of all required fees, including the renewal of the license, within the time frame outlined in the Guidelines.

1. Returns that comply with the guidelines are followed.

2. Adherence to CBN policies, guidelines, and circulars, especially those pertaining to countering the financing of terrorism (CFT), anti-money laundering (AML), and counter-proliferation financing (CPF).

Conclusion

The goal of the Central Bank’s array of initiatives is to provide the apex bank with information about transactions occurring in the parallel market. This led to the government making inquiries with the cryptocurrency platform, Binance. Following a request from the authorities to view a list of Nigerians using Binance for peer-to-peer USDT/NGN trading, the National Security Adviser (NSA) detained two executives of Binance on Wednesday.

CBN governor Olayemi Cardoso stated at the conclusion of the rate-setting meeting on Tuesday, “What we’re hoping to accomplish by this, frankly, is to bring some sanity to an industry that arguably no longer serves the interests of those whom it was meant to protect.”

Share your love
Abdullahi Kafayat
Abdullahi Kafayat

Abdullahi Kafayat is an enthusiastic writer interested in the tech world. She's a graduate of Obafemi Awolowo University and has a BSc in Chemistry. You can reach her at Kafayatabdullahi17@gmail.com.

Articles: 192

Newsletter Updates

Enter your email address below and subscribe to our newsletter

Stay informed and not overwhelmed, subscribe now!