CBN Requires Bureau de Change Operators to Reapply for New Licenses
By Patience Ikpeme
The Central Bank of Nigeria (CBN) has mandated all Bureau de Change (BDC) operators to reapply for new operational licenses by June 3, 2024, to continue participating in the foreign exchange market.
This directive, issued in a circular signed by Haruna Mustafa, CBN’s Director of the Financial Policy and Regulation Department, introduces significant changes to the licensing process and operational requirements for BDCs. The changes are part of broader reforms aimed at enhancing the role of BDCs in Nigeria’s forex market.
Key changes and requirements contained in the approved guideline include: BDCs must now choose between two tiers of operation: Tier 1 requires a minimum capital of N2 billion. Tier 2 requires a minimum capital of N500 million.
All existing BDCs must reapply for licenses under their chosen tier by June 3, 2024. They must meet the new capital requirements within six months from the effective date of the guidelines.
Applicants for new licenses must provide details of the promoter, including the promoter’s name, proposed BDC name, email address, and phone number.
The mandatory caution deposits of N200 million for Tier 1 and N50 million for Tier 2 have been eliminated.
The non-refundable annual license renewal fees of N5 million for Tier 1 and N1 million for Tier 2 have been removed.
These reforms, according to the CBN, are designed to reposition the BDC sector and ensure it effectively contributes to the foreign exchange market. The revised guidelines also cover permissible activities, corporate governance, and anti-money laundering measures for BDCs.
This move marks a significant shift in the regulatory landscape for BDC operators in Nigeria, aiming to strengthen their role in stabilizing the forex market.
