I have wondered why it's difficult for CBN to give directives for banks to sell dollars.
Why should Nigerians be forced to go to semi-illiterates to buy dollars in the black market?

Why can't I just pay my bank to buy dollars at the CBN rate?

I see the FG every now and then blaming "illegal" BDCs for naira depreciation.

derecho:
I have wondered why it's difficult for CBN to give directives for banks to sell dollars.
Why should Nigerians be forced go to semi-illiterates to buy dollars in the black market.

Why can't I just pay my bank to buy dollars at the CBN rate?

I see the FG every now and then blaming "illegal" BDCs for naira depreciation.

that is what they were doing before, but the corrupt banks will hoard the dollars and sell to bdcs at more than the CBN official rates and the bdcs will in turn sell the dollars they got from the commercial banks at parallel market rates to Nigerians in need of dollars. The banks were making more money from this practice, corruption has eaten too deep into every fabric of the Nigerian society

derecho:
I have wondered why it's difficult for CBN to give directives for banks to sell dollars.
Why should Nigerians be forced to go to semi-illiterates to buy dollars in the black market?

Why can't I just pay my bank to buy dollars at the CBN rate?

I see the FG every now and then blaming "illegal" BDCs for naira depreciation.

Banks are always allowed to buy and sell dollars. Their License allows this. But they don't usually have available from cbn and customers don't approach Banks because of documents and process required. Aboki will give you dollars Sharp sharp without documents

What documents do you need to buy from banks?

sholatech:


Banks are always allowed to buy and sell dollars. Their License allows this. But they don't usually have available from cbn and customers don't approach Banks because of documents and process required. Aboki will give you dollars Sharp sharp without documents

Two valid points up there

True.. Sometimes I feel the people in power just love making live difficult for the masses.

Banks/Bankers are our major problem.

derecho:
What documents do you need to buy from banks?

Depends on purpose. If you are importing you need your Form M and tax clearance. If you paying foreign school fees you need the school fees document. If sending money for family members only your tax clearance etc

Banks will do exactly what they did with the new notes during naira redesign era.

derecho:
I have wondered why it's difficult for CBN to give directives for banks to sell dollars.
Why should Nigerians be forced to go to semi-illiterates to buy dollars in the black market?

Why can't I just pay my bank to buy dollars at the CBN rate?

I see the FG every now and then blaming "illegal" BDCs for naira depreciation.

Don't you see how ridiculous your plan is.

Firstly, there would always be a black market, we love dollar a lot in this country. Secondly, if there is a black market, I would buy from the bank and sell the black marker. Let me give you an instance, I used to work in a bank, when FG had a lot of foreign reserve and the banks sold dollar, there was no pressure, you could buy dollar from the bank during Jonathan regime, but the economic downturn started and the foreign reserve shrunk, Nigerians turned to the black market and these black market people simply raised the price as demand was so high. Trust Nigerians, the cbn still made allocations available for traveller's and students. Thousands of people would buy the dollar from the bank at cbn rate and go and sell in the black market. It was terrible, out of 50 people buying, only 10 people would genuinely travel and out of those 10 people, 9.9 did not need the full amount of USD4,000 allocated by Cbn. Infact, it seemed as if the government was subsidizing the travel expenses of Nigeria. Let me give u an instance, let's say in 2023 I wanted to travel to Kenya, I would buy my ticket around 400k, I would then approach the bank and buy PTA 4K USD at the official rate of 419, and after that I would go to the black market and sell it at 900 naira per dollar, I will make double the amount I spent for the PTA, just in a day, I will make a profit of 900k or there about. For schools fees scam, the profit was even more but I do not have the time or strength to type here. But as long as there is a powerful market and the pressure is on the Naira, it would be a mess.

melow666:


Don't you see how ridiculous your plan is.

Firstly, there would always be a black market, we love dollar a lot in this country. Secondly, if there is a black market, I would buy from the bank and sell the black marker. Let me give you an instance, I used to work in a bank, when FG had a lot of foreign reserve and the banks sold dollar, there was no pressure, you could buy dollar from the bank during Jonathan regime, but the economic downturn started and the foreign reserve shrunk, Nigerians turned to the black market and these black market people simply raised the price as demand was so high. Trust Nigerians, the cbn still made allocations available for traveller's and students. Thousands of people would buy the dollar from the bank at cbn rate and go and sell in the black market. It was terrible, out of 50 people buying, only 10 people would genuinely travel and out of those 10 people, 9.9 did not need the full amount of USD4,000 allocated by Cbn. Infact, it seemed as if the government was subsidizing the travel expenses of Nigeria. Let me give u an instance, let's say in 2023 I wanted to travel to Kenya, I would buy my ticket around 400k, I would then approach the bank and buy PTA 4K USD at the official rate of 419, and after that I would go to the black market and sell it at 900 naira per dollar, I will make double the amount I spent for the PTA, just in a day, I will make a profit of 900k or there about. For schools fees scam, the profit was even more but I do not have the time or strength to type here. But as long as there is a powerful market and the pressure is on the Naira, it would be a mess.

Well said.
But can't "Black market" be done away with? The official recognition is nauseating.

oz4real83:
that is what they were doing before, but the corrupt banks will hoard the dollars and sell to bdcs at more than the CBN official rates and the bdcs will in turn sell the dollars they got from the commercial banks at parallel market rates to Nigerians in need of dollars. The banks were making more money from this practice, corruption has eaten too deep into every fabric of the Nigerian society

Isn't it the same thing the BDCs are doing

The problem is the CBN not doing it's job as a regulatory agency over banks. If you give a quota of forex to banks for sale, they should have records to back up it's sale. Anyone should be able to walk into the bank and buy forex. The banks, the CBN and the BDCs are all one and the same people

derecho:
I have wondered why it's difficult for CBN to give directives for banks to sell dollars.
Why should Nigerians be forced to go to semi-illiterates to buy dollars in the black market?

Why can't I just pay my bank to buy dollars at the CBN rate?

I see the FG every now and then blaming "illegal" BDCs for naira depreciation.

The thing is ''must the dollar be in cash''.
All dollars should be credited in accounts or through cards. I can remember cash cards. All lots of traders use bank wallets(opay, palmpay etc), how much more for a international traveller. CBN should collaborate with Mastercard, Visa etc

.

IN OTHER SANE COUNTRIES IT IS HIGHLY ILLEGAL TO HAWK CURRENCY,AND ONLY BANKS ARE ALLOWED.
The north abused it,now they see as their stupid business,something that is causing inflation and sabotaging the country economy.
IT WAS FORMERS RULERS IN 1970S THAT STARTED THIS RUBBISH. THEY NOW ENRICHED ACROSS THEIR GENERATION. EVIL WICKED LEADERS.
IT MUST BE STOPPED,LET BANKS SELL CURRENCIES WITH EVIDENT RECORDS OF PROPER ACCOUNTABILITY AND MONITOR THE SELLING RATES. I don't ever buy dollars from roadside hawkers,I buy from banks or office of bdcs ONKY CRIMINALS WHO WANT TO HIDE THEIR DRUG MONEY,ILLICIT MONEY,LOOTED FUNDS PATRONIZE HAWKERS.

The simple reasons are

Cutting corners is inbuilt in us.

Even if one way is longer, Nigerian will stii following

And the ones in suits and tie are worst

Those one doing it without fear.

Inspirer1:

Well said.
But can't "Black market" be done away with? The official recognition is nauseating.

The only way to reduce the influence of the black market is economic and financial. Mostly economic and less financial.
Black markers exist for a reason, to meet the deficiency of the official market. When Tinubu came in, he did away the the pegging officially of the naira to a particular rate, thus floating the naira to diminish the influence of the black market, that was a wrong move, it created panic, panic is the worst thing that happen in the financial market, people panic bought dollar as the naira slid down, the black marketers felt the burn but they knew it was going to be short lived, foreign investors pulled out their foreign currency from the nigerian market. some people manipulated the market by hoarding the dollar they already had betting that Naira was going to keep falling unless the government intervened, others like myself used my little naira to buy small dollars hoping to starve off the fall of the naira and its effect on the price of goods and services.

The destroy the black market, the Nigerian government should adopt good economic and fiscal policies, writing here would bore you and these are not immediate.

However immediately, my plan is this, I worked in a bank for more than 15 years. No 1. Stop customers from paying cash into their FCY account, it makes no sense, if you have deposits, make it in naira, no withdrawal of USD, you must sell your USD to the bank. Starve Nigerians and the black market off USD, if you are a business person and want USD, bring the proper documents and the bank would Transfer to your vendor, remove USD cash from circulation in the Nigerian markets, BDCs would reduce

melow666:

The only way to reduce the influence of the black market is economic and financial. Mostly economic and less financial.
Black markers exist for a reason, to meet the deficiency of the official market. When Tinubu came in, he did away the the pegging officially of the naira to a particular rate, thus floating the naira to diminish the influence of the black market, that was a wrong move, it created panic, panic is the worst thing that happen in the financial market, people panic bought dollar as the naira slid down, the black marketers felt the burn but they knew it was going to be short lived, foreign investors pulled out their foreign currency from the nigerian market. some people manipulated the market by hoarding the dollar they already had betting that Naira was going to keep falling unless the government intervened, others like myself used my little naira to buy small dollars hoping to starve off the fall of the naira and its effect on the price of goods and services.

The destroy the black market, the Nigerian government should adopt good economic and fiscal policies, writing here would bore you and these are not immediate.

However immediately, my plan is this, I worked in a bank for more than 15 years. No 1. Stop customers from paying cash into their FCY account, it makes no sense, if you have deposits, make it in naira, no withdrawal of USD, you must sell your USD to the bank. Starve Nigerians and the black market off USD, if you are a business person and want USD, bring the proper documents and the bank would Transfer to your vendor, remove USD cash from circulation in the Nigerian markets, BDCs would reduce

I know we have different forms (M, X) that can be accessed from the cbn tradesystem.portal, I wonder why some traders still go through black market to access the needed dollars to carry out their purchases, knowing fully well that cbn has also lifted forex restrictions on so many goods hence the privilege of importers of such goods to access forex at cbn rate,,,,, we need to do an analysis of what goods are being imported by those who access forex via bdc, likewise the volume of same, if its volume is significant enough to impact on the dollar/naira relationship and necessary as per its need by Nigerians, perhaps the cbn can capture it amongst lawful goods that can be imported using the cbn official tradesystem portal.

Furthermore, the issue of accessing dollars via black market to pay for visa, ihs fee etc should be looked into, these payments are official, why can't people pay for visa and ihs fees through a dedicated cbn portal like the tradesystem portal where form A is used to pay for tuition and where PTA and BTA are accessed.

It's just for the cbn to make further findings, what and what do people need foreign for, try to make such payments official through tradesystem portal, make withdrawal of foreign currency illegal like you said and observe the situation for further necessary actions .