CBN Ban on FX to BDCs, Why You Need Not Worry – “Not all the BDCs are bad, but as it is now CBN has banned both the good and the bad.”
The entry of BDCs into the Nigerian financial system in 1989 was to broaden the foreign exchange market and improve access to foreign currencies, due to challenges encountered by commercial banks in offering such services. Today we have about 5,500 BDCs in Nigeria. (According to a report by This Day).
The role of BDCs has indeed come as a messiah to millions of travelers in Nigeria for a good number of years now. It is however important to note that the CBN has now found it absolutely necessary to come up with a new policy for BDCs to curb the conduit for illicit forex flows and graft, hence the halt on issuance of new licenses to in-coming BDCs. Times like this is why we have built our services over the years on transparency, responsibility, excellence and operated within the confines of the law since our inception.
A past President of the Chattered Institute of Bankers of Nigeria (CIBN), Mr Okechukwu Unegbu, has said that the recent CBN policy on BDCs would create some challenges in the market, he said commercial banks might not be able to meet up with the forex demands of importers.
“Not all the BDCs are bad, but as it is now CBN has banned both the good and the bad.
“This measure by the CBN can negatively affect the forex trading market. Most businessmen, when they cannot access forex from commercial banks, rush to the BDCs”
The long-term benefits of the ban on the economy is not all doom but will come at some costs, not withstanding, we are highly committed to pull through this trying period knowing fully well that our customers still need our services. This goes to say we are still in business and we still offer foreign exchange services. With the help of our committed team we have been able to come up with strategies that will ensure you do not end up in long stressful bank queues.
In fact, other strings are being pulled already to find a common ground. Recently, the President of the Association of Bureau De Change Operators of Nigeria, Aminu Gwadabe (ABCON) released a statement to that effect with the hope of engaging the CBN. He said;
“BDCs are licensed to provide retail FX services, including buying from the public and also selling to end-users for allowable transactions namely PTA, BTA, payment of medical and school fees, while the CBN had stopped dollar sale to BDCs, it has not cancelled their operating licenses, or banned them from providing forex services to members of the public”.
The president further called on ABCON members to see the CBN pronouncement as a wakeup call and an opportunity to widen their customer base and deepen their business.
We can assure all our existing customers that we have been diversifying into other business already before the CBN ban, as a company with vision we felt the need to expand into real estate and other financial services.
The bottom line of the CBN’s new policy on BDCs and forex trading generally lies on a long-term benefit, if everything goes right, we are looking at a financially stable system and overall economic growth.