… Pegs Minimum Capital Requirement At N2bn And N500m
Following allegations of illegality and negative impact to the economy, and as part of reforms to re-position the Bureau De Change (BDC), the Central Bank of Nigeria (CBN) has directed all existing Bureau De Change (BDC) Operators to re-apply for licences, and meet new capital requirements.
In a circular published on Wednesday, the CBN noted that the Guidelines, which takes effect from June, 2024, will have all existing BDCs reapply for new licences according to their licence category of choice, and meet with the capital requirements for same category within six (6) months from the effective date of the Guidelines.
The CBN further affirms that the new guideline supersedes the Revised Operational Guidelines for Bureau De Change in Nigeria, which was issued in November 2015, and all other related documents, circulars and directives.
In February 2024, the Apex Bank, as part of reforms to re-position the Bureau De Change (BDC) sub-sector to play its envisioned role in the foreign exchange market in Nigeria, issued the Draft Operational Guidelines for BDC Operations in Nigeria, for stakeholder comments/inputs.
The circular, signed the CBN Director of Financial Policy and Regulation Department, Haruna Mustafa, affirms the Apex Banks resolution: “Following the conclusion of the stakeholder consultations and in exercise of the powers conferred on it by Section 56 of the Banks and Other Financial Institutions Act (BOFIA) 2020, the CBN hereby issues the attached Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria 2024 for compliance by all operators and promoters of proposed BDCs in Nigeria.”
The Guideline requires prospective BDCs in Tier-1 to have a minimum capital requirement of two billion naira (N2,000,000,000), a non-refundable Application fee of one million naira (N1,000,000), and a non-refundable Licence Fee of Five million naira (N5,000,000). Tier-2 applicants will provide proof of minimum capital requirement of Five hundred million naira (N500,000,000), a non-refundable Application fee of Two hundred and Fifty thousand naira (N250,000), and a non-refundable Licence Fee of Two million naira (N2,000,000).
The bank also made some changes to the guidelines of existing BDCs. These changes include the removal of the mandatory caution deposit of N200 million for 1 licence holders and N50 million for 2 licence holders.
The CBN also withdrew the non-refundable Annual Licence Renewal Fee of N5 million and N1 million for Tiers 1 and 2 BDCs, respectively.
Tier-1 operators are allowed a nation-wide service, while Tier-2 operators are restricted to only one State with only five (5) branch outlets within the State.
The Regulatory And Supervisory Guidelines For Bureau De Change Operations In Nigeria outlines sources of foreign currencies for BDCs; conditions for sale of foreign currencies; non-eligible promoters of BDCs; and permissible and non-permissible activities, among others.
