CBN assures BDCs of support, to consider recommendations

Hopes were again raised on Wednesday over a probable re-integration of the Bureau De Change (BDC) operators into the foreign exchange (forex) market, as the Central Bank of Nigeria (CBN) affirmed it is considering opportunities for the estranged group.

The assurance came at an interactive session between BDCs and the apex bank in Lagos, a day after the currency traders said CBN would integrate them in the current forex market in a matter of days.

The Deputy Director, Financial Policy and Regulation, Anthony Ikem, said he was conveying the management assurances that all hopes were not lost for the BDC operators.

“I am here on behalf of the management of CBN to encourage you and let you know that all hopes are not lost. CBN is not unmindful of the possible effects of the new policy on BDCs.

“As we speak, the management is working hard to see how it can accommodate and carry every stakeholder along so that there will be joy in the land. All that CBN is asking of you is to be patient and cooperate with it to see what can come out of it.

“The new policy is just about nine days old. Efforts are being made to see how BDCs will be carried along, because CBN recognizes the importance of your operations to the economy of this country.

“For now, you need to partner and cooperate with CBN. The management of CBN will look into your recommendations to see how viable they are in solving the problems of foreign exchange in Nigeria,” he said.

The President of Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe, said his members are upbeat that CBN will implement the outcome of the meeting in Abuja, where the apex bank accepted to create special window for the BDC operators.

According to him, his members have also agreed to ensure that the spike in the naira exchange rate against the dollar is drastically reduced by their operations.

From 2006 till date, we have been in the business of helping CBN to keep rates at reasonable level. It is because we are out now that the parallel rate has remained high despite the new policy contributions.

“Before the introduction of the new policy, the rate was N320, but after the announcement it started the northward movement.

“Almost everybody in the country is a speculator. The British pounds crashed in sixteen years history, but in Nigeria, the pounds is rather going higher. This is the activity of speculators and we must address it.

“There are already expectations of BDCs coming back to the market. We are completing our processes of automation, documentations and bringing a website that would help disseminate information to the public. We are really coming back prepared.

“But as a way forward, we ask for clarification on the policy to guide us, to look into the creation of new window that will co-opt BDCs into the new regime, which we hope will materialize soon, and licensing us to compete favourably with the global market,” he said.

Gwadabe reiterated that the operating modalities that would guide their activities on return to the market is already being worked-out and should be ready in the next one week, which part of the guidelines is that the a BDC must have an office, and properly document their transactions.

“The meeting was successful and in line with BDCs’ demand for a more inclusive policy. We also pledged to the CBN to sanction any operator that violates the policy guidelines,” he said.

The group, among other things, urged CBN to be more sensitive to the segment, as well as considerate in its policy formulation to allow them play fully their roles.

They recommended compulsory dollar inflows by the forex primary dealers from their accounts overseas, which is estimated at over $4 billion, rather than being sharing partners of the foreign reserve at home.

“We urge CBN to make retail forex transactions the exclusive preserve of BDCs and grant approval-in –principle or certificate of no objection to ‘ABCON Roadmap.’

“We urge CBN to allow ABCON participate in formulation of forex policies, especially in matters relating to BDCs, develop a framework on regular training, and restore and enforce the self-regulatory status of ABCON, as well as making membership of the association a criteria for licensing and renewal,” Gwadabe said.