To bolster the foreign exchange market, the Central Bank of Nigeria (CBN) has announced the sale of $20,000 to each eligible Bureau De Change (BDC) operator at a rate of N1,590 per dollar.
Daily Report Nigeria reports that this initiative, detailed in a circular dated 25th September 2024, aims to inject additional liquidity into this segment of the market.
The circular, signed by Dr W J Kanya, the Acting Director of the Trade and Exchange Department, outlines the specifics of this transaction.
Kanya said:
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“The CBN has sanctioned the sale of $20,000 to each qualifying BDC at the rate of ₦1,590 per dollar. This measure is intended to satisfy the demand for invisible transactions.”
Invisible transactions typically refer to services and intangible goods such as payments for education, medical expenses abroad, or personal travel allowances, which do not involve physical goods crossing borders.
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Furthermore, the CBN has stipulated that all BDCs are permitted to sell to eligible end-users at a margin not exceeding one percent above the purchase rate from the CBN.
This directive is designed to ensure transparency and curb excessive profit margins on foreign exchange transactions.
Eligible BDCs wishing to participate in this transaction are required to make the necessary naira payment to their respective CBN deposit account numbers.
In addition, payment confirmation and all requisite documentation for disbursement must be submitted at designated CBN branches in Abuja, Awka, Kano, and Lagos for the collection of the $20,000.
CBN’s decision will expected to provide a much-needed boost in foreign exchange liquidity within the retail market segment, particularly for personal and business transactions classified as invisible.
