Buy at N410, sell at N460 or above; Banks are Profiting from Nigerians in the Foreign Exchange Market

Buy at N410, sell at N460 or above; Banks are Profiting from Nigerians in the Foreign Exchange Market

  • In July the Central Bank of Nigeria stop the sale of dollars to Bureau du Change operators in a bid to ensure Naira exchange can be well managed
  • Data from the investors and exporters window the official market on which Nigeria currency is pegged closed thursday at 414.07/$1
  • However banks are selling above 460/$ which experts describe as outrageous with a call for bank customers to report to the Banking Supervision Department of the CBN

The cost of buying Dollars from Nigerian banks have increased in the last few days, according to BusinessDay report.

The report which quote various customers reveals it now cost 45.15 percent more to exchange dollar across official banking channels

One of the customers quoted in the report, said he performed a dollar transaction on his Globus account last month, and was charged over N601 to a dollar.

Read also

Still waiting to fly as nigerian government spend on national carrier rises to N14.6bn next year

Banks Are Making A Fortune From Nigerians In The Foreign Exchange Market
Naira to dollar exchange rate Credit: peeterv

The customer said

Do you have a groundbreaking story you would like us to publish? Please reach us through info@corp.legit.ng!

Then yesterday (last Friday) I tried again and I was charged N595.08 to a dollar. There is no prompt to let you know that’s the rate you will be charged,” the customer said.

This means that the bank charged an average cost of N598.04k per dollar, as opposed to the N412 that banks are obliged to charge after purchasing from the Central Bank of Nigeria (CBN) for N410 per dollar.

Other rates quoted in the report include Access Bank N450 per dollar as of October 13, 2021, UBA rate at (N465/$), Ecobank (N450/$), Wema Bank (N461/$), and FCMB (N480/$).

Sterling Bank (N460/$), Standard Chartered Bank (N463/$).

Only Union Bank rate the bank noted remained unchanged at N412/$.

Banks CEO promises

Following the CBN's suspension of dollar sales to Bureau De Change (BDC) operators in July 2021, the Body of Bank Chief Executive Officers (CEOs) predicted that the naira-dollar exchange rate, which fell to as low as N527/$ per dollar in the same month, would recover to at least N423 per dollar, but this has not occurred.

Read also

CBN provides updates on BVN rules, discloses penalties for financial institutions, customers for violation

In a subsequent press conference, the CEOs of the banks stated that they have the infrastructure and ability to service the lawful foreign exchange demand of end consumers. Business Travel Allowance (BTA), Personal Travel Allowance (PTA), education tuition, and medical expenses are examples of valid demands.

Segun Agbaje, group CEO of GTCO plc, said.

“Different banks are going to have different processes because you will have to look at your controls, you will have to look at what works for you. There is a lot of abuse around foreign exchange, so we might find that to better control this you might want to decentralise or centralise or a combination of the two”

Naira Continues Free-Fall At Official Markets, But CBN Gets Dollar Firepower To Defend Before It Gets Worst

Meanwhile legit.ng had ealier reported that the rise in oil price, the successful Eurobond, and also the International Monetary fund(IMF) $3.5 billion SDR credit have helped boost Nigeria's reserves.

Read also

FG picks Nigerian youths for massive investment fund, lists conditions for clearance

The report noted thatNigeria reserves could hit over 40 billion in the coming months when CBN gets all the money expected.

The rise in external reserves will come as a welcome boost for CBN in its fights to keep Naira stable amid pressure from investors and Nigerians for foreign currency

Source: Legit

Online view pixel