Bureaux de change (BDC) operators have suggested a N15 million capital requirement and extension of deadline by the Central Bank of
Nigeria (CBN).
The CBN had on June 23, 2014 raised the minimum capital requirement for BDCs from N10 million to N35 million, in a new rule
to weed out unserious elements in that sub-sector and correct some grave inefficiencies and sharp practices.
The new guidelines further stipulate a mandatory cautionary deposit reviewed to N35 million, which is expected to be deposited in a
non-interest yielding account in the CBN, upon the grant of an approval-in-principle.
BDC operators believe that the new policy guidelines have the potential to crush most of them out of business, thereby destabilising the foreign
exchange market, empowering the black market, as well as occasioning the widening of the exchange rate premium and rendering many Nigerians jobless.
The Association of Bureaux de Change Operators of Nigeria (ABCON) at its emergency general meeting of the South West zone held on Monday in Lagos, made several recommendations on the new policy.
One of such recommendations is for a refund of the earlier N500,000 mandatory cautionary deposit of over 2500 BDCs, which amounts to N1,250,000,000 and has been with the CBN for over 10 years.
According to Aminu Gwadabe, acting national president and Uduma Cletus, executive secretary, the N35 million mandatory cautionary deposit should be put on hold, pending a comprehensive engagement with stakeholders.
“We also recommend that for now, the caution deposit should be 20% of the amount of dollar sales to the BDCs, since we are not
deposit takers like other CBN regulated entities (deposit money banks, primary mortgage institutions, insurance institutions, micro finance
banks and discount houses).
“These sister organisations require no caution deposit to carry on their business”, they said at the meeting.
“In order to boost the image of the BDCs in a growing world, we suggest a percentage increase of 50% of the N10 million capital deposit with a one year moratorium”, they added.
They also recommended that the association be allowed to play their normal statutory role of self-regulation, as well as compulsory membership being maintained as a licensing requirement of the CBN.
The executive council of the association appeals to all members to remain calm, patient and hopeful, adding that the new requirements would be reviewed and the deadline for compliance extended.
