CBN: BDCs No Longer Required To Pay N200m Deposit, Says New Apex Bank Regulation

The Central Bank of Nigeria, CBN, has revised its regulatory guidelines for Bureau De Change in the country.

According to a circular issued by Haruna Mustafa, the apex bank’s Director, Financial Policy and Regulation Department BDCs in the country would no longer be required to deposit caution fee with the CBN.

The magazine reported that the CBN updated its guidelines in February this year where it required Tier 1 and Tier 2 BDCs operators to deposit N200 million, and N50 million respectively with the apex bank as mandatory caution fees.

Tier 1 and Tier 2 BDCs were also required by the guidelines to pay N5 million, and N1 million for license renewal.

But these requirements are no longer necessary, according to the updated guidelines shared by the bank on Wednesday.

The apex bank stated that the decision was arrived at following various consultations with stakeholders, adding that this is part of the ongoing reform in the foreign exchange market by the Cardoso-led CBN.

The apex bank  said, “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.”

The new guidelines is effective from  June 3, 2024, the apex bank said.