TheNewsGuru

Tag: BDC

  • CBN debunks BDC recapitalisation deadline shift

    CBN debunks BDC recapitalisation deadline shift

    The Central Bank of Nigeria (CBN) has debunked a news story circulating that suggested it had extended the deadline for the recapitalisation of Bureau De Change (BDC) operators to Dec. 31.

    In a statement on Wednesday, Mrs Hakama Sidi Ali, CBN Acting Director, Corporate Communications Department, described the information as false and misleading, stating that it should be disregarded.

    According to her, the bank has not granted any such extension beyond the previously communicated deadline of June 3.

    She urged the general public, journalists, media platforms, and all stakeholders to consistently verify information directly from official CBN sources.

    She said such sources include the CBN website and authorised communication channels, before publishing or sharing news about the Bank and its regulatory directives.

    “The CBN remains committed to ensuring transparency, stability, and compliance in the foreign exchange market and will continue to engage with all relevant stakeholders in accordance with its statutory mandate,” Sidi Ali said.

    As part of the revised framework introduced in February 2024, BDCs are required to meet new minimum capital requirements: N2 billion for Tier-1 and N500 million for Tier-2 operators.

    CBN in May 2024 issued new operational guidelines for BDCs, effective June 3, 2024, directing all existing BDCs to reapply for new licenses.

    BDCs with Tier 1 licenses were expected to have a capital base of N2 billion, while those with Tier 2 licenses needed N500 million, with non-refundable license fees of N5 million and N2 million, respectively.

    Both Tier 1 and Tier 2 BDCs were given six months to meet the minimum capital requirement for the license category applied for.

    The apex bank later extended the recapitalisation deadline by an additional six months for BDC operators to meet the new capital threshold by June 3.

  • BDC operators seek exemption from excise taxes

    BDC operators seek exemption from excise taxes

    The Association of Bureau De Change Operators (ABCON) on Thursday sought the exemption of excise taxes on foreign exchange transactions.

    Excise duty is a tax charged on manufactured goods; levied at the time of manufacture.

    Its President, Alhaji Aminu Gwadabe, made the request at the House of Representative’s Public Hearing on Tax Reform Bill in Abuja.

    Gwadabe, represented by the Chairman, North Central Zone, Mr Thomas Okoye, prayed the lawmakers to exempt excise taxes on transactions by licensed and regulated Bureaux De Change (BDCs) to avoid over-generalisations.

    Gwadabe warned that excise tax on foreign exchange transactions would exacerbate the exchange rate volatility in the market if applied to licensed bureaux.

    “The policy lacks clarity as the excise tax is on parallel market activities. It will be transferred to end users; it would worsen inflation as we depend highly on importation,” he said.

    The BDC President also warned that excise tax on foreign exchange transactions would lead to unemployment.

    Gwadabe also sought a review of the new Central Bank of Nigeria (CBN) capital financial requirements of five hundred million naira and two billion naira category for BDC licensing.

    Also speaking, the Comptroller-General of Customs, Bashir Adeniyi, solicited closer collaboration with the Nigeria Export Processing Zones Authority (NEPZA).

    Adeniyi said that such collaboration would enhance efficiency in the supervision and regulation of the movement of goods into Nigeria.

    The three-day Public Hearing on the Tax Reform Bill by the House of Representatives has come to an end.

  • CBN issues new FX guidelines to BDC operators

    CBN issues new FX guidelines to BDC operators

    The Central Bank of Nigeria (CBN) has issued new guidelines restricting Bureau de Change (BDC) operators to purchasing foreign exchange from a single authorised dealer per week.

    The bank also directed the BDCs to comply with Know Your Customer (KYC) measures.

    The apex bank, in a circular signed by W. J. Kanya, Acting Director, Trade and Exchange Department, mandated a weekly purchase cap of 25,000  dollars per BDC from authorised dealers.

    “A BDC shall approach its preferred Authorised Dealer Bank (ADB) and can only procure the said amount from only that bank of its choice in a week. Any breach of this condition will attract appropriate sanction.

    “The selling rate by the Authorised Dealers to BDCs shall be the prevailing day rate at NFEM window,” it said.

    CBN permitted FX cash purchased by BDCs from authorised dealer banks to be sold to end-users at a rate not exceeding one per cent margin above the buying rate.

    The apex bank said the one per cent margin shall be applicable to all funds to be retailed by BDCs regardless of sources of fund.

    It also mandated authorised dealer banks to render weekly returns on sales to BDCs on a specified format attached to the guidelines to be addressed to the apex bank.

    It urged all BDCs to render daily returns on FX purchases from authorised dealer banks and other sources as well as sales on the Financial Institutions Forex Reporting System (FIFX).

    It further directed that funds purchased by BDCs be disbursed for specific transactions including Business Travel Allowance/Personal Travel Allowance; Overseas School fees and Overseas Medical fees.

    It insisted that in all cases the maximum disbursement per transaction should not exceed 5,000 dollars, quarterly.

    “Records shall be maintained for all transactions by the BDCs showing the BVN of the end-user, including endorsement of the amount disbursed in the International Passport of the beneficiary;

    “It is to be noted that Authorised Dealer Banks and BDC operators shall ensure strict compliance to the provisions of Anti-Money Laundering Laws and observance of appropriate KYC principles in the handling of these transactions,” it stated.

    CBN added that authorised dealer and BDC that divert funds or violate the provision of the guidelines would face sanctions including, suspension of its dealership license.

  • CBN approves $20,000 for eligible BDCs at N1,580 exchange rate

    CBN approves $20,000 for eligible BDCs at N1,580 exchange rate

    The Central Bank of Nigeria (CBN), says it has approved 20,000 dollars each for eligible Bureaux De Change (BDCs) at the rate of N1,580 to a dollar.

    This is according to a statement issued by Dr Williams kanaya, the Acting Director, Trade and Exchange Department of the apex bank.

    “This is to inform the BDC operators and the general public that we are providing more liquidity into the market.

    “To this end, the CBN has approved the sale of 20,000 dollars to each eligible BDCs operator at the rate of N1, 580/dollar. This is to meet the demand for invisible transactions.

    “All BDCs are allowed to sell to eligible end-users at a margin not more than one per cent above the purchase rate from CBN.

    “Eligible BDCs interested in this transaction are directed to make the Naira payment to the CBN deposit account numbers with them,” he said.

    He said that payment confirmation and all necessary documentation for disbursement are to be submitted at the appropriate CBN branches in Abuja, Awka, Kano and Lagos for collection of the 20,000.00 dollars.

  • BDC association mulls unified market for operators

    BDC association mulls unified market for operators

    The Association of Bureau De Change Operators of Nigeria (ABCON) has warned economic saboteurs speculating and hoarding the Naira to desist from such act.

    ABCON President, Alhaji Aminu Gwadabe, in a statement on Friday, also said the association would establish a unified retail-end forex market to tackle volatility and boost regulatory compliance among Bureau de Change (BDC) operators.

    He said that the strategic plan meant to unify operators from different cadres of the market would include the inauguration of state chapters for market coordination.

    This, he noted, was to ensure integration and administration of a united market structure in the BDC sub-sector.

    He added that ABCON would upgrade technology in its quest to help in the fight against the sabotage of CBN’s reforms.

    “The new blueprint for a united retail end forex market structure would ensure the deployment of a centralised, democratised and liberalised onlinereal-timee trading platform.

    “Finally, we also condemned in its entirety the seemingly reappearance of illegal economic behaviours in forex conversion and P2P trading that pose another recent surprises in Naira volatility.

    “I therefore want to warn that while surprises are the new normal, resilience is also the new skills,” he said.

    The ABCON boss said that he was confident that the apex bank and relevant security agencies were adopting all measures to deal with any saboteurs and retain successes recorded on Naira appreciation.

    “It is, therefore, in our own interest to desist from hoarding and speculation as it is a burble and will burst in no distance time,” he added.

    Gwadabe said that ABCON would extend its automation policies and platforms to all BDC operators across Nigeria markets and upgrade its Business Process Platform(formerly called SAAZ Master).

    Gwadabe said that the association would sustain its engagement with regulatory agencies, security operatives and other government apparatus to entrench a secured and thriving forex market that is supportive to regulation and government.

    “Part of our vision for a united retail-end forex market include activating geo mapping and automated BDCs physical office verification exercise using the Remote Gravity Physical verification apps.

    “This will enable forex buyers to easily locate where BDCs offices are for effective and seamless transactions,” he said.

    He reiterated the benefits of a realistic and vibrant retail-end forex market as supporting Central Bank of Nigeria (CBN’s) goal of achieving true price discovery for the Naira, balancing of international obligations and national objectives.

    He listed other benefits to include ensuring ease of regulation, security agencies monitoring and supervision as well as entrenching market visibility for BDC players.

    According to Gwadabe, the vision for a united retail-end forex market will help in the provision of market intelligence reports, enhance the local and global image of the BDCs and other stakeholders, market operators and boost employment generation.

    The successful execution of this plan, Gwadabe said, would help in seamlessly capturing revenues for government through digitised retail-end market.

    He explained that it would also create a well structured, transparent and competitive platform to checkmate the menace of unlicensed platforms like Binance, Aboki FX, ByBit, among others.

    He said that ABCON is a self-regulatory body, an umbrella body for all the Central Bank of Nigeria -CBN licensed BDCs.

    “It is a national body, acknowledged by Federal Government and believes that money laundering through the BDCs or any other financial Institution is unacceptable and those found wanting should be punished based on the law,” he said.

    He added that the association had over the years “lived up to its name by protecting the interests of genuine forex dealers and supporting a stronger Naira”.

    He said that ABCON had since its inauguration, redefined Nigeria’s BDC sector with technology, capacity building for operators and support for exchange rate stability.

    Gwadabe said the overall primary goal of ABCON was to ensure forex availability to the critical retail end of the forex market and bridge the gap between the official and the parallel market exchange rates.

    “With the world going digital, BDC operators under the ABCON leadership are committed to staying ahead of the competition by deploying time-tested technology to deliver effective services to foreign exchange end-users,” he said.

  • How BDC operator allegedly defrauded me of $63,950 – Man tells court

    How BDC operator allegedly defrauded me of $63,950 – Man tells court

    A businessman, Mr Chinedu Igbokwe, on Tuesday, told an Ikeja Special Court how a Bureau de Change operator, Abdulami Isah, allegedly defrauded him of $63,950.

    Igbokwe, who  was led in evidence by the Economic and Financial Crimes Commission (EFCC) Counsel, Mr A. A. Usman, said he was introduced to Isah  on Oct 4, 2022, and by Oct. 6, he paid the defendant the said amount.

    The witness said after he made the payment, he waited for them to remit the fund (naira equivalent) and when they were not forthcoming, he then went to meet them.

    “They told me that Isah has received the money and when I met him, he confirmed that he has received and withdrew the fund.

    “He paid the sum of N15.9 million and when I asked him what is happening he switched off his phone and I could not find him again.

    “The pressure was much on me and I had to take money from my local textile business to pay people in other to keep my reputation.

    “On Aug. 18, 2023, I petitioned EFCC and two days later, the commission acknowledged the petition and by Aug.25, the defendant was arrested.

    “What surprised me most was when I visited EFCC office after the arrest, Isah opened to EFCC that he is a syndicate to Alli Baba,” Igbokwe said.

    The witness further told the court that the payment was made through the international account number of the defendant.

    He confirmed to the court that the defendant had refunded N15.9 million, while the outstanding was N26.5 million.

    Isah is standing trial on a three-count charge bordering on obtaining by false pretense and fraud.

    Justice Ismail Ijelu adjourned till April 22 for continuation of trial.

  • Superiors call lawyer to withdraw case against BDC operators

    Superiors call lawyer to withdraw case against BDC operators

    A prosecutor in Lagos State has been called by his superiors to withdraw a case levelled against some Bureau de Change (BDC) operators in the State from court.

    TheNewsGuru.com (TNG) reports the court, a Federal High Court presided over by Justice Lewis Allagoa, subsequently struck out the case on Monday.

    Nineteen (19) Bureau de Change (BDC) operators had been charged with conspiracy, unlawful operation of forex trading without licence from regulatory agencies and deriving various sums of money from such unauthorised trading.

    They were said to have committed the offence around February 21, within the Lagos metropolis.

    The suspects were Ibrahim Jubril, Abdullahi Abubakar, Ibrahim Hassan, Adamu Isiaka, Ibrahim Abdulrahman, Jubril Hassan, Mohammed Isoaka, Mohammed Aminu and Adamu Ibrahim.

    Others are Hassan Amadu, Salisu Hamidu, Mahmoud Mohammed, Murtala Usman, Hassan Yakubu, Abdullahi Kabiru, Ali Sadam, Ahmadu Yusuf, Abdullahi Hussain and Alhaji Sido.

    When the case was called, Mr Umaru Bello, from the State Criminal Investigation Department (CID), Panti announced appearance for the prosecution.

    The prosecutor, shortly after his announcement, informed the court that he seeks to withdraw the charge against the defendants.

    He told the court that he received a call from his superiors in the office to withdraw the case.

    He told the court that he would not be proceeding with the arraignment of the suspects.

    While Bello did not give explicit reasons for withdrawing the case, Justice Allagoa accordingly, struck out the charge.

    The police had earlier said that the offence contravenes the provisions of the Banks and Other Financial Institutions Act 2020.

  • Kano BDC operators sent to jail for operating without licence

    Kano BDC operators sent to jail for operating without licence

    Three Bureau de Change operators have been convicted and sentenced to three years in prison for operating without a requisite licence in Kano State.

    TheNewsGuru.com (TNG) reports the BDC operators were convicted and sentenced by Justice Mohammed Nasir Yunusa of the Federal High Court, Kano.

    The convicts are Umar Ibrahim Muhammad, Abubakar Yakubu Garba and Muhammad Tijjani. They were jailed after pleading guilty to one-count separate charge of illegal dealing in foreign currency without an appropriate licence.

    The lone-count charge reads: “That you Ibrahim Muhammad, sometime in February 2024 in Kano within the jurisdiction of this honourable court did engage in a financial operation of bureau de change without a valid licence and you thereby committed an offence contrary to Section 57 (5) of the Banks and Other Financial Institutions Act 2020 and punishable under Section 57 (5) (B) of the same Act.”

    They all pleaded “guilty” to the charge read to them in English and interpreted in Hausa, upon which prosecution counsel, Aisha Tahar Habib prayed the court to convict and sentence them accordingly, while the defence counsel pleaded for mercy and leniency.

    Justice Yunusa thereafter convicted and sentenced Muhammad, Garba and Tijani to one year imprisonment each with an option of fine of N100,000(One Hundred Thousand Naira) each.

    Their road to jail began when they were arrested by operatives of the Kano Command of the EFCC for operating a BDC without an appropriate licence.

  • BREAKING: CBN revokes operational licences of 4,173 BDC operators [SEE FULL LIST]

    BREAKING: CBN revokes operational licences of 4,173 BDC operators [SEE FULL LIST]

    The Central Bank of Nigeria (CBN) has revoked the operational licences of 4,173 Bureau De Change (BDC) operators and published the list of BDCs affected.

    TheNewsGuru.com (TNG) reports the apex bank published the list on Friday while disclosing the affected BDCs failed to observe some regulatory provisions.

    The regulatory provisions listed by CBN are payment of all necessary fees, including licence renewal, within the stipulated period in line with the Guidelines and rendition of returns in line with the Guidelines.

    CBN also disclosed one of the regulatory provisions as compliance with guidelines, directives and circulars of the CBN, particularly Anti-Money Laundering (AML), Countering the Financing of Terrorism (CFT) and Counter-Proliferation Financing (CPF) regulations.

    The apex bank said this is in exercise of the powers conferred on it under the Bank and Other Financial Institutions Act (BOFIA) 2020, Act No. 5, and the Revised Operational Guidelines for Bureaux De Change 2015 (the Guidelines).

    “The list of affected BDC operators is available on the Bank’s website,” CBN disclosed in a statement by Sidi Ali Hakama (Mrs.), Ag. Director, Corporate Communications.

    The apex bank also disclosed it is revising the regulatory and supervisory guidelines for Bureau de Change operations in the country.

    “Compliance with the new requirements will be mandatory for all stakeholders in the sector when the revised guidelines become effective.

    “Members of the public are hereby advised to take note and be guided accordingly,” it stated.

    See full list of affected 4,173 BDC operators here

  • CBN approves $20,000 to BDCs to meet demands

    CBN approves $20,000 to BDCs to meet demands

    The Central Bank of Nigeria (CBN) on Tuesday approved allocation of 20,000 dollars to all eligible Bureau De Change (BDC) operators across the country as part of its on-going reforms.

    Dr Hassan Mahmud, Director, Trade and Exchange Department, CBN, in a circular, said the move was aimed at tackling distortions in the retail segment of the nation’s foreign exchange market.

    The circular addressed to BDC Operators said they were allowed to sell to end-users at a margin not more than one per cent above the purchase rate from CBN.

    “Following the on-going reforms in the foreign exchange market, aimed at achieving an appropriate market determined exchange rate for the Naira, the Central Bank of Nigeria (CBN) has observed the continued price distortions at the retail end of the market, which is feeding into the parallel market and further widening the exchange rate premium.

    “To this end, the CBN has approved the sale of foreign exchange to eligible Bureau De Change (BDCs) to meet the demand for invisible transactions.

    “The sum of $20,000 is to be sold to each BDC at the rate of N1,301/$ – (representing the lower band rate of executed spot transactions at NAFEM for the previous trading day, as at today, 27th February 2024).

    “All BDCs are allowed to sell to end-users at a margin NOT MORE THAN one percent (1%) above the purchase rate from CBN.

    “All eligible BDCs are directed to make the Naira payment to the designated CBN Foreign Currency Deposit Naira Accounts and submit confirmation of payment, with other necessary documentations, for disbursement at the appropriate CBN Branches – ABUJA, AWKA, LAGOS and KAΝΟ),” it started.

    The News Agency of Nigeria (NAN) reports that a guideline was attached for the BDCs’ disbursement and monitoring of utilization.

    It noted that all those allocated Foreign Exchange, must keep records of beneficiaries and amount sold to each of them.

    It said BDCs should not sell more than 4,000 dollars per individual for Personal Travel Allowance and 5,000 dollars for Business Travel Allowances.

    It listed other guidelines including, BDCs allocated buying and selling rate, prohibition of street hawking of forex, daily provision of the sale of Foreign Exchange to end users, among others.