Bureau De Change Operators Face Uphill Battle as CBN Recapitalisation Deadline Looms
Nigeria’s Bureau De Change (BDC) operators are grappling with the challenge of meeting the Central Bank of Nigeria’s (CBN) new capitalisation requirements, despite a six-month extension granted last December. The revised deadline, now set for June 3, 2025, has left many operators scrambling to strategise or consolidate their resources.
Aminu Gwadebe, President of the Association of Bureau De Change Operators of Nigeria (ABCON), described compliance as “lukewarm” during an interview with The Punch. “A lot of our members are finding it difficult to meet the requirements,” he admitted, adding that mergers remain a key option for survival.
New Tiers, Steeper Demands
The CBN’s May 2024 guidelines introduced two new licensing categories for BDC operators, each with significantly elevated financial thresholds. Tier 1 BDCs are now required to have a minimum capital base of ₦2bn, with non-refundable application and licensing fees of ₦1m and ₦5m, respectively. Tier 2 operators face a slightly less onerous ₦500m minimum capital requirement, alongside fees of ₦250,000 and ₦2m.
The stricter rules, according to the CBN, align with global industry practices and aim to stabilise Nigeria’s volatile forex market. However, Gwadebe noted that many BDC operators are struggling to adapt. “We are engaging with the Central Bank to explore possible reviews, but the CBN has insisted the financial requirements are non-negotiable,” he said.
Forex Market Challenges
Gwadebe linked the future of the naira in 2025 to robust liquidity interventions by the CBN. Despite recent efforts, including directives for BDCs and banks to engage in autonomous transactions via the Electronic Foreign Exchange Matching System, implementation has been sluggish.
“The perception of liquidity is critical,” Gwadebe argued. “If people believe there’s enough supply in the market, speculative demand and hoarding will decline, easing pressure on the naira.” He forecast the currency stabilising between ₦1,500 and ₦1,600 to the dollar, provided supply-side measures are effective.
Diaspora Remittances: A New Frontier
Amid the recapitalisation drive, the CBN has introduced a new initiative targeting Nigerians in the diaspora. The Non-Resident Nigerian Ordinary Account (NRNOA) and the Non-Resident Nigerian Investment Account (NRNIA) are designed to channel foreign earnings into the Nigerian economy.
The accounts, which allow holders to manage funds in both local and foreign currencies, aim to boost diaspora contributions to economic growth. They also offer investment opportunities, including participation in Nigeria’s Diaspora Bond.
Gwadebe welcomed the initiative, noting that diaspora remittances remain a vital source of foreign exchange. However, he cautioned that the success of the scheme would hinge on clarity around its operational modalities.
A Sector in Flux
As the June deadline approaches, Nigeria’s BDC operators face a moment of reckoning. While the recapitalisation policy could bolster the sector’s resilience and alignment with global standards, the immediate impact is proving painful for many operators.
For the CBN, the challenge will be to strike a balance between enforcing reforms and ensuring the survival of a sector that plays a crucial role in the country’s forex ecosystem.
