To stabilise the foreign exchange market, the Central Bank of Nigeria, CBN has eased its stiff measures to enable the Bureau De Change, BDCs, ( commonly known as Parallel Marketers) to come back into operation (i.e. buy and sell of FX), but with new operational guidelines that must be strictly adhered to.
Background
The CBN under the leadership of its now suspended Boss, Dr Godwin Emefiele, had said the BDCs had become money laundering agents, stressing that the CBN “will deal ruthlessly with Nigerian banks who have acted as collaborators with these illegal forex dealers, we will deal with them ruthlessly because they have allowed their banking and payment system infrastructure to facilitate these illegal dealings in foreign exchange”.
He claimed at the time that the BDCs were dollarising the Nigerian economy and subverting the cashless policy of the central bank. This led to the ban on some BDC merchants from the FX markets.
However, the current leadership of the apex bank led by Folorunsho Shonubi, has now come up with new operational guidelines to enable the BDCs to participate in the market in a bid to rescue the Naira from the daily rapidly falling against the Dollars by giving them access to foreign currencies to make Importers and Exporters get FX with ease.
This new initiative will serve as a relief to among many other things, the importation of the 41 items currently banned from the Nigeria Foreign Exchange Market.
New Operational Guidelines and Explanations
1. The spread on buying and selling by BDC Operators shall be within an allowable limit of -2.5% to +2.5% of the Nigerian Foreign Exchange market window weighted average rate of the previous day. This means that the BDCs can sell FX with a maximum of 2.5% of the amount with which they bought from the CBN.
2. Mandatory rendition (hand over) by BDC Operators of the statutory periodic reports (daily, weekly, monthly, quarterly and yearly) on the Financial Institution Forex Rendition System (FIFX) which has been upgraded to meet individual Operator’s requirements. This means that it is now compulsory for BDCs operators to give adequate reports on FX dealings (sales) and handing over to FIFX.
Penalties for Defaulters
1. Non-rendition of returns by operators would attract sanctions which may include withdrawal of operating license.
2. Operators are- expected to il returns where they do not have any transaction within the period.