CBN Approves BDCs in Forex Market with $150,000 Weekly Cap

Central Bank of Nigeria Integrates Licensed Bureaux de Change into Official Forex Market

The Central Bank of Nigeria (CBN) has formally integrated licensed Bureaux de Change (BDCs) into the Nigerian Foreign Exchange Market (NFEM), a move designed to enhance foreign exchange liquidity in the retail segment and better serve end-user demand.

In a circular signed by Dr. Musa Nakorji, Director of the Trade and Exchange Department, the CBN announced that all duly licensed BDCs may now access foreign currency through any Authorised Dealer Bank at prevailing market rates. To manage volumes, the central bank capped weekly FX purchases by each BDC at $150,000.

The policy aims to deepen market efficiency and broaden access to foreign exchange across the economy by formally incorporating these retail-focused currency exchange operators into the official trading framework.

However, the CBN imposed stringent compliance and risk-management conditions. Authorised Dealer Banks must conduct comprehensive Know-Your-Customer (KYC) and due diligence checks on BDCs and their clients prior to any transaction. To strengthen transparency, all licensed BDCs are mandated to submit timely and accurate electronic returns in line with existing regulations.

Furthermore, BDCs are prohibited from holding open FX positions. Any unutilised foreign exchange purchased from the NFEM must be sold back into the market within 24 hours.

Settlement processes are also tightly regulated. All FX transactions must be channeled through settlement accounts with licensed financial institutions. Third-party transactions are explicitly forbidden, and cash settlement is capped at a maximum of 25 per cent of any transaction’s total value.

This adjustment formalises the role of BDCs within Nigeria’s regulated forex ecosystem, seeking to balance improved retail access with robust oversight to prevent market abuse and ensure stability.