The Central Bank of Nigeria (CBN) has made changes to its rules governing Bureau De Change (BDC) operators.
Following consultations with stakeholders, the CBN has implemented the following revisions:
- The mandatory caution deposit of N200 million for tier-1 BDC license holders and N50 million for tier-2 license holders has been eliminated.
- The non-refundable annual license renewal fee has been removed. Previously, tier-1 BDCs paid N5 million, and tier-2 BDCs paid N1 million for renewal.
These adjustments aim to simplify BDC operations and improve financial accessibility, according to Haruna Mustafa, the Director of the Financial Policy and Regulation Department at the CBN.
Existing BDCs are required to re-apply for a new license based on their preferred tier or license category outlined in the guidelines. New applicants must meet the specified conditions for their chosen category.
Existing BDCs must also meet the minimum capital requirements for their selected license category within six months from the effective date of the guidelines.
The guidelines have also been updated to align permissible activities for BDCs with market needs and regulatory standards. BDCs are expected to comply with corporate governance requirements, as well as anti-money laundering, counter-terrorism financing, and counter-proliferation financing provisions.
The CBN stated that the receipt and processing of license applications will commence from the effective date of the guideline. Interested applicants are instructed to electronically submit the promoter’s name, proposed BDC name, promoter’s email address, and phone number to [email protected].
These guidelines replace the Revised Operational Guidelines for Bureau De Change in Nigeria issued in November 2015 and all related circulars and directives.
The Regulatory and Supervisory Guidelines for BDC Operations take effect from June 3, 2024.
The circular partly read, “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, the Central Bank of Nigeria (CBN) issued the Draft Operational Guidelines for BDC Operations in Nigeria in February 2024, for stakeholder comments/inputs.
“Following the conclusion of the stakeholder consultations and in the 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 guidelines, amongst others, introduce new licensing requirements and categories of BDCs as well as revise the permissible activities, financial requirements, corporate governance requirements and AML/CFT/CPF provisions for BDCs.
“All existing BDCs shall: Re-apply for a new license according to any of the Tiers or license categories of their choice as provided in the Guidelines.
“Meet the minimum capital requirements for the license category applied for within six (6) months from the effective date of the Guidelines.
“Applicants for New BDC License Applicants for a new BDC license are required to meet the conditions for the grant of license in accordance with the Tier or category of BDC chosen as stipulated in the Guidelines. Receipt and processing of applications for license shall commence from the effective date of the Guidelines.”
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