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CBN restricts Dollar from BDC to $10k for school fees, $5k for medicare

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The Central Bank of Nigeria has placed limits on the foreign exchange sales by Bureau De Change (BDC) operators in a new document titled: “Revised Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria”.

The circular with Ref: FPR/DIR/PUB/CIR/002/006 dated February 23, 2024 and titled: “Revised Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria – Exposure Draft,” was signed by the Director, Financial Policy and Regulation Department, Mr Haruna B. Mustafa.

In the reversed regulatory guidelines, CBN stated that BDCs may sell foreign currency in the equivalent of $4,000 and $5,000 for personal travel allowance (PTA) or business travel allowance (BTA), respectively, to an individual once every six months.

According to the Bankers’ bank the sale of foreign currencies to the intending travellers would have to be accompanied with their bank verification number (BVN) or tax identification number (TIN), duly completed e-form, valid international passport, valid visa, as well as valid international return ticket.

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In addition, for BTA, the apex bank said letter of request from the corporate body stating the purpose of the visit addressed to the processing BDC, as well as certificate of the business registration or incorporation, must be submitted by customers.

Also, the CBN mandated that letter of invitation from the customer’s overseas business partner and tax clearance certificate, be presented by the customers.

“The amount of foreign currency sold and date of sale shall be endorsed on the passport. A photocopy of the documents, forex endorsement page and sales receipt shall be filed in a sequential order by the BDC,” CBN said.

CBN also said BDCs may sell foreign currency up to the equivalent of $5,000 to a customer for medical bills once a year.

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Such bill, CBN said, shall be transferred from the BDC’s domiciliary account with a Nigerian bank.

“It shall be paid directly to the hospital and supported by valid visa, duly completed e-Form A, letter of reference from a specialist doctor, or a specialist hospital in Nigeria, and valid international passport,” the apex bank said.

Other necessary documents listed by the financial regulator include valid air ticket, and letter issued by the overseas specialist doctor stating the cost of treatment.

According to the apex bank, BDCs may sell foreign currency up to the equivalent of $10,000 to a customer for school fees once a year.

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“Such fee, which shall be transferred from the BDC’s domiciliary account with a Nigerian bank, shall be paid directly to the school and supported by the following documents: duly completed e-Form A, evidence of admission/course programme, valid air ticket, and letter issued by the overseas specialist doctor stating the cost of treatment, and school bill/invoice,” CBN said.

“For post-graduate studies, photocopy of first degree certificate or its equivalent/certified true copy of statement of result by the awarding institution.

“The CBN may review the amounts and frequencies for sale of foreign exchange from time to time.”

A beneficiary of foreign currency sale may receive up to 25 percent of the foreign currency in cash, according to the CBN, and the remaining 75 percent shall be transferred to the customer electronically (to the customer’s Nigerian domiciliary account or prepaid travel card).

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CBN, However, noted that the guidelines significantly enhances the regulatory framework for the operations of Bureau De Change as part of ongoing reforms of the Nigerian foreign exchange market.

The letter partly read: “Pursuant to the powers conferred under Section 56 of the Banks and Other Financial Institutions Act, 2020 (BOFIA), the Central Bank of Nigeria (CBN) hereby issues this draft revised Regulatory and Supervisory Guidelines for Bureau de Change (BDC) Operations in Nigeria for stakeholder comments and/or inputs.

“The Guidelines significantly enhances the regulatory framework for the operations of Bureau De Change as part of ongoing reforms of the Nigerian foreign exchange market. The Guidelines revises the permissible activities, licensing requirements, corporate governance, and Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) provisions for BDCs.

“It also sets out new record-keeping and reporting requirements, among others,” the circular indicated. It advised that every comments should be directed to the Director, Financial Policy and Regulation Department Central Bank of Nigeria, Abuja with soft copies mailed to PolicyandRegulationDivision@cbn.gov.ng by March 4, 2024.

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In the draft reversed guidelines, the apex bank stated that “No person shall carry on the business of BDC in Nigeria except with the prior authorization of the CBN.”

It defined a BDC as a company licensed by the CBN to carry on only retail foreign exchange business in Nigeria.

On non-eligible promoters, the CBN listed categories of people and organisations that shall not be allowed to participate in the ownership of BDCs, directly or indirectly among whom are:

“Commercial, merchant, non-interest and payment service banks; Other Financial Institutions (OFIs), including holding companies and payment service providers and Serving staff of financial services regulatory and supervisory agencies.

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“Serving staff of regulated financial services providers; Governments at all levels; Public officers as defined in 5th Schedule Part IV of the Constitution of the Federal Republic of Nigeria.

“Non Governmental organizations; Cooperative societies; Charitable organizations; Academic and religious institutions; Non-Nigerian non-resident natural persons; Non-Nigerian resident natural persons and Non-resident non-regulated companies.

“Telecommunication services providers; Sanctioned individuals and entities; A shareholder in another BDC (whether directly or indirectly); Any other entity that the CBN may from time to time designate.”

Under Permissible Activities; the apex bank stated that a BDC may: “Acquire foreign currency from the sources listed in Section 4.0; Sell foreign exchange as detailed in Section 5.0; Open foreign currency and naira accounts with Commercial or Non-Interest Banks (CNIBs); Collaborate with their banks to issue prepaid cards. And Serve as cash-out points for International Money Transfer Operators (IMTOs).”

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On the Non-Permissible Activities, the CBN stated that a BDC or its franchisee shall not engage in –

“Street-trading; Maintaining any type of account for any member of the public, including accepting any asset for safe keeping/custody.

“Taking deposits from or granting loans to members of the public in any currency and in any form; International outward transfers; Retail sale of foreign currencies to non-individuals, except for BTA

“Engaging in off-shore business or maintaining foreign correspondent relationship with any foreign establishment. Opening or maintaining any account with any bank or financial institution outside

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Nigeria. Acting as custodian of foreign currency on behalf of customers.

“International inward transfers, except for operators that serve as cash-out points for IMTOs. Borrowing sums which in aggregate exceed the equivalent of 30 per cent of its shareholders’ funds unimpaired by losses, in the BDC’s audited financial statements of the preceding year.

“Engaging in forwards, futures, options, or other derivative/speculative transactions. Obtaining foreign exchange from sources other than those listed in Section 4.0. Granting of loans and advances in any currency. Selling foreign exchange on credit to any customer. Engaging in any trade-related import activities.

“Serving as payment or collection agents on behalf of customers. Dealing in gold or other precious metals. Carrying on capital market, insurance and/or pension sector activities. Establishing subsidiaries.

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Any foreign exchange transaction that involves illicit financial flows.

“Financing of political activities. All other businesses not expressly permitted by this Guidelines. Any other activity as may from time to time be termed “non-permissible” by the CBN.

On the Sources of Foreign Currencies; the apex bank listed the following as conditions that shall apply for the sourcing of foreign currencies by BDCs:

“i. A BDC may source foreign currency from: a. Tourists. b. Returnees from the diaspora. c. Expatriates with foreign exchange inflows from work, travel, investment or their domiciliary accounts.

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“d. Residents with foreign exchange inflows from work, travel, investment or their domiciliary accounts. e. International Money Transfer Operators (IMTOs),

f. Embassies. g. Hotels that are authorised buyers of foreign currencies. h. The Nigerian Foreign Exchange Market (NFEM). i. Any other source that the CBN may specify.”

“ii. Sellers of the equivalent of USD10,000 and above to a BDC are required to declare the source of the foreign exchange and comply with all AML/CFT/CPF regulations and foreign exchange laws and regulations.”

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Economy

SEE Black Market Dollar To Naira Exchange Rate In Lagos, FCT, April 7th 2025

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The local currency (abokiFx) opened at ₦1,560.00 per $1 at the parallel market, otherwise known as the black market, today, Monday, 7 April 2025, in Lagos, Nigeria, after it closed at ₦1,550.00 per $1 on Sunday, 6 April 2025.

Black market dollar to naira exchange rate today, 7 April 2025, also known as Aboki forex, can be accessed below.

NOTE: The exchange rate changes hourly. It depends on the volume of dollars available and the Demand. What this means is that…you can buy or sell 1 dollar at a certain rate and the price can change (high or low) within hours.

The official naira black market exchange rate in Nigeria today, including the Black Market rates, Bureau De Change (BDC), and CBN rates. Please note that the exchange rate is subject to hourly fluctuations influenced by the supply and demand of dollars in the market. As of now, you can purchase 1 dollar at a certain rate now however, it’s important to remember that the rate can shift (either upwards or downwards) within hours.

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Economy

Crude prices slump to $65 first time since 2021

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Oil prices plunged this week to $65 per barrel as the United States import tariffs and an unexpected OPEC+ supply hike erased $10 per barrel from global benchmarks.

The price appreciated last week when US President Donald Trump imposed tariffs on any country that buys crude from Venezuela.

However, oil prices turned around the corner as of Friday, with Brent falling to $65, the first time since 2021.

According to oilprice.com, the combined effect of Trump’s import tariffs, OPEC+’s inopportune decision to speed up the unwinding of production cuts, and China’s retaliatory actions wiped off $10 per barrel from global oil prices, “with ICE Brent falling below $65 per barrel for the first time since August 2021.”

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The US West Texas Intermediate crude futures lost $4.96, or 7.4 per cent to end at $61.99.

“Seeing backwardation barely change compared to the beginning of the week, one could assume that US tariffs are the defining factor for the price change. Nevertheless, this week will not go down well in the history of oil markets,” oilprice.com reports.

China’s retaliatory tariffs on US goods have escalated a trade war that has led investors to price in a higher probability of recession.

China, the world’s top oil importer, announced it will impose additional tariffs of 34 per cent on all US goods from April 10.

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According to Reuters, nations around the world have readied retaliation after Trump raised tariffs to their highest in more than a century.

Aside from the tariffs, another factor that further pressured oil prices was the Organisation of the Petroleum Exporting Countries and Allies’ decision to advance plans for output increases.

The group now aims to return 411,000 barrels per day to the market in May, up from the previously planned 135,000 bpd.

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CBN allocates $197.71m into FX market to support naira

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The Central Bank of Nigeria has injected $197.71m into the foreign exchange market on Friday, April 4, 2025, as part of its commitment to ensuring adequate liquidity and maintaining orderly market functioning.

This was disclosed in a statement on Saturday by the Director of the Financial Markets Department, Dr Omolara Omotunde-Duke, reiterating the bank’s stance on maintaining market integrity and operational transparency.

The statement read, “In line with its commitment to ensuring adequate liquidity and supporting orderly market functioning, the CBN facilitated market activity on Friday, April 4, 2025, with the provision of $197.71m through sales to authorised dealers. This measured step aligns with the bank’s broader objective of fostering a stable, transparent, and efficient foreign exchange market.”

The CBN said the intervention was in line with its broader objective of fostering a stable, transparent, and efficient foreign exchange market.

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It added that it remained focused on sustaining liquidity levels to support smooth market operations amid ongoing global economic adjustments.

The apex bank said the decision to boost liquidity in the FX market came against the backdrop of significant shifts in the global macroeconomic landscape, which had affected many emerging markets and developing economies, including Nigeria.

It noted that the recent introduction of new import tariffs by the United States on goods from several economies had triggered adjustments across global markets.

It added that crude oil prices—a major revenue source for Nigeria—had dropped by over 12 per cent, settling at approximately $65.50 per barrel.

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The CBN said the downturn posed challenges for oil-exporting countries, influencing exchange rate dynamics and market sentiment.

The CBN stressed that it would continue to monitor both global and domestic market conditions. It expressed confidence in the resilience of Nigeria’s foreign exchange framework, which it said was designed to adjust appropriately to changing economic fundamentals.

The bank also urged all authorised dealers to strictly adhere to the principles outlined in the Nigerian FX Market Code, promoting transparency and upholding the highest standards in their transactions with clients and market counterparties.

Meanwhile, Nigeria’s official exchange rate fell to N1,600/$1 at the end of trading on April 4, 2025, as the tariffs imposed during the Trump era continued to impact global markets.

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Data from the CBN showed that the naira closed at N1,600/$1, marking a 1.9 per cent depreciation compared to the N1,569/$1 recorded the previous day.

The figure also marked the weakest level the naira had reached since December 4, 2024, when it closed at N1,608/$1. The exchange rate has now weakened by 3.9 per cent in the first four days of April, after closing March at N1,537/$1.

According to the CBN, the exchange rate closed at N1,600/$1 on Friday, marking a 1.9 per cent drop from the previous day.

The intra-day highs and lows were reported as N1,625 and N1,519 to the dollar, respectively. The intra-day high of N1,625 is also one of the highest levels recorded this year, indicating that traders priced the naira at significantly weaker levels.

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Conversely, the intra-day low of N1,519/$1 suggests that some traders still priced the naira stronger, possibly betting on short-term interventions.

The NFEM rate, which represents the average exchange rate, closed at N1,567, the weakest the naira has traded this year and since December 4, 2024.

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