Economy

CBN threatens to suspend top Nigerian Banks and BDCs Licenses If…

Published

1 day ago

February 6, 2025

…found diverting funds

The Central Bank of Nigeria (CBN) has announced that it will suspend the dealership licenses of any Bureau de Change (BDC) operators or Authorised Dealer banks found diverting funds or violating its newly implemented foreign exchange trade guidelines.

In a statement issued on Tuesday, the CBN, through its Acting Director of Trade and Exchange Department, Dr. W.J Kanya, emphasized that these guidelines were introduced following the temporary approval granted to existing BDCs to purchase foreign exchange from Authorised Dealers, with a weekly limit of $25,000.

Additionally, the apex bank has set a maximum disbursement limit of $5,000 per transaction on a quarterly basis for BDCs.

Key Guidelines for Foreign Exchange Transactions
The CBN outlined the following conditions for foreign exchange transactions involving BDCs and Authorised Dealer Banks:

Authorised Dealers are permitted to sell a maximum of $25,000 per week to each BDC.

A BDC must purchase foreign exchange from only one preferred Authorised Dealer Bank per week, and any violation of this rule will result in sanctions.

The selling rate for foreign exchange from Authorised Dealers to BDCs must align with the prevailing daily rate at the Nigerian Foreign Exchange Market (NFEM) window.
BDCs must sell foreign exchange to end-users at a maximum margin of 1% above the buying rate.

The 1% margin limit applies to all funds retailed by BDCs, regardless of their source.

Authorised Dealer Banks are required to submit weekly reports on sales to BDCs using the specified reporting format, sending them to the CBN’s Trade & Exchange Department via [email protected].
BDCs must also submit daily transaction reports detailing foreign exchange purchases from Authorised Dealer Banks and other sources, as well as utilization records, on the Financial Institutions Forex Reporting System (FIFX).
Permitted Uses and Compliance Measures
Funds obtained by BDCs can only be disbursed for the following transactions, with a quarterly transaction limit of $5,000:

Business Travel Allowance (BTA) / Personal Travel Allowance (PTA)
Overseas school fees
Overseas medical fees
BDC operators must maintain detailed records of all transactions, including:

The Bank Verification Number (BVN) of each end-user.
Endorsement of the disbursed amount in the beneficiary’s international passport.

The CBN also reiterated the importance of strict adherence to Anti-Money Laundering (AML) laws and Know Your Customer (KYC) protocols in handling foreign exchange transactions.
Penalties for Non-Compliance
The CBN warned that any Authorised Dealer Bank or BDC operator found violating these guidelines, including fund diversion, will face severe sanctions, which may include suspension of their dealership licenses.

Related Topics:CBN Economy Nigeria Nigerian school

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SEE Black Market Dollar To Naira Exchange Rate In Lagos, FCT, 6th February 2025

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Economy

SEE Black Market Dollar To Naira Exchange Rate in Lagos and FCT today, 7th February 2025

Published

7 hours ago

February 7, 2025

Naijablitznews

The official naira black market exchange rate in Lagos and FCT, Abuja today including the Black Market rates, Bureau De Change (BDC), and CBN rates.

According to Bureau De Change (BDC) sources in the Ogba and Ikeja axis of Lagos state, the exchange rate for a dollar to naira at the Parallel Market (Black Market) is N1700 on Friday, February 7th, 2024, players bought a dollar for N1685 and sold it for N1700.

Bureau De Change (BDC) sources in Gwarimpa and Gwagwalada in FCT buy a dollar for N1685 and sell it for N1700 on Friday, February 7th, 2024.

Please note that the Central Bank of Nigeria (CBN) does not recognize the parallel market (black market), as it has directed individuals who want to engage in Forex to approach their respective banks.

Dollar to Naira Black Market Rate Lagos
Dollar to Naira (USD to NGN) Black Market Exchange Rate Today
Buying Rate N1685
Selling Rate N1700
Dollar to Naira Black Market Rate FCT, Abuja
Dollar to Naira (USD to NGN) CBN Rate Today
Buying Rate N1685
Selling Rate N1700
Please note that the rates you buy or sell forex may differ from what is captured in this article because prices vary from state to state across Nigeria.

Economy

CBN lists conditions for sale of FX to BDC operators

Published

14 hours ago

February 7, 2025

Kayode Sanni-Arewa

The Central Bank of Nigeria, CBN, has issued guidelines for the sale of foreign exchange (FX) to Bureaux De Change, BDC, operators.

The modalities are outlined in a statement issued by the Trade and Exchange Department of the CBN on Wednesday.

The Apex Bank stated that this is in response to its earlier authorization granting temporary access to existing BDCs to the Nigerian Foreign Exchange Market (NFEM) for the purchase of FX from authorized dealers.

The CBN noted that authorized dealers are only allowed to sell foreign exchange cash to BDCs, subject to a maximum of USD 25,000.00 per week per BDC.

The Apex Bank warned that any breach of this condition will attract appropriate sanctions.

The CBN emphasized that the selling rate by authorized dealers to BDCs shall be the prevailing day rate at the NFEM window.

According to the statement from the bank, “foreign exchange cash purchased by BDCs from authorized dealer banks shall be sold to foreign exchange end-users at a rate not exceeding a one percent margin above the buying rate.

“While the one percent margin stated above shall be applicable to all funds to be retailed by BDCs, regardless of the source of funds.”

Economy

Bank of England cuts interest rate to 4.5%

Published

15 hours ago

February 7, 2025

Kayode Sanni-Arewa

The Bank of England, on Thursday, reduced its key interest rate by a quarter point to 4.5 percent to help support weak British growth even if UK inflation stays elevated.

“We’ll be monitoring the UK economy and global developments very closely and taking a gradual and careful approach to reducing rates further,” governor Andrew Bailey said following the expected decision.

“It will be welcome news that we have been able to cut interest rates again today.

“We’ll be monitoring the UK economy and global developments very closely and taking a gradual and careful approach to reducing rates further.”

The details of the rate cut is on the Bank’s website, titled, “Bank Rate reduced to 4.5% – February 2025.”

According to the Bank, “At its meeting ending on 5 February 2025, the Monetary Policy Committee, MPC, voted by a majority of 7–2 to reduce Bank Rate by 0.25 percentage points, to 4.5%.

“Two members preferred to reduce Bank Rate by 0.5 percentage points, to 4.25%.

“There has been substantial progress on disinflation over the past two years, as previous external shocks have receded, and as the restrictive stance of monetary policy has curbed second-round effects and stabilised longer-term inflation expectations.

“That progress has allowed the MPC to withdraw gradually some degree of policy restraint, while maintaining Bank Rate in restrictive territory so as to continue to squeeze out persistent inflationary pressures.

“CPI inflation was 2.5% in 2024 Q4. Domestic inflationary pressures are moderating, but they remain somewhat elevated, and some indicators have eased more slowly than expected.

“Higher global energy costs and regulated price changes are expected to push up headline CPI inflation to 3.7% in 2025 Q3, even as underlying domestic inflationary pressures are expected to wane further.

“While CPI inflation is expected to fall back to around the 2% target thereafter, the Committee will pay close attention to any consequent signs of more lasting inflationary pressures.”