Naira Rebounds in Official Market, Crashes Again in Black Market as CBN Issues New Guides to BDCs

Naira Rebounds in Official Market, Crashes Again in Black Market as CBN Issues New Guides to BDCs

  • The Nigerian currency recorded an N82 gain in the official market on Monday, February 26, 2024
  • The naira exchanged for N1,582.94 per dollar as against the N1,665.5 that it was traded for on Friday, February 23, 2024
  • The local currency, however, depreciated in the parallel market after days of gains to trade at N1,680 per dollar’s Pascal Oparada has reported Tech, Energy, Stocks, Investment and the Economy for over a decade.

The Nigerian currency experienced a slight depreciation in the parallel market, trading at N1,680 per dollar after days of gains.

In the official Nigerian Autonomous Foreign Exchange Market (NAFEM), the naira gained about N82.52, trading at N1,582.94 per dollar compared to the N1,665.5 per dollar it closed on Friday, February 23, 2024.

Naira recovers going by NAFEM's data but depreciates after a new CBN rule
Naira recovers in the official market but falls in the black market after CBN's new rule. Credit: Novartis
Source: Getty Images

Naira falls in the black market after EFCC raid

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The naira gained in the parallel market last week following the arrests of black market operators believed to be behind the currency’s fall.

The move saw the local market gaining almost N300 over the weekend from N1,920 to about N1,600 but slightly declined on Monday, February 26, 2024.

The Nigerian foreign exchange market recorded a daily turnover of $115.493 million on Monday, February 26, 2024, against the $151.93 million recorded on Friday, February 23, 2024.

The naira recorded an intraday high of N1,778 per dollar and an intraday low of N1,300 per dollar on Monday, February 26, 2024.

CBN issues new directives to BDCs

The Central Bank of Nigeria (CBN) has proposed new regulations to increase Nigeria’s minimum requirements for Bureau de Change (BDC) operators to N2 billion and N500 million for Tier 1 and Tier 2 licences.

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The latest development changes from the previous requirement of N35 million for a general license.

The new directive is in an exposure draft in Nigeria's Revised Regulatory Supervisory Guidelines for Bureau De Change operations.

According to the new regulations released by the apex bank, the updated regulations disclosed that once approved, the guidelines will come into effect on a date determined by the CBN.

CBN's requirements for BDCs

The new guidelines require that Tier 1 operators maintain a minimum share capital of N2 billion and also submit a mandatory caution deposit of N200 million, with an application fee of N1 million, while the license fee is N5 million.

Tier-1 operators are authorised to operate nationally, can open branches, and may appoint franchisees based on the CBN's approval.

A Tier-1 operator shall exercise supervisory oversight over its franchisees, with all franchisees adopting their franchisor’s name, branding, technology platform and rendition requirements.

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CBN readjust exchange rate For cargo clearance as naira gains in official Market

Tier-2 operators must possess a minimum share capital of N500 million and maintain a mandatory deposit of N50 million.

CBN moves to place annual limit on foreign school fees reported that the Central Bank of Nigeria (CBN) is reportedly planning to introduce strict measures on purchasing foreign currencies via Bureau de Change (BDC) operators in Nigeria regarding transactions on overseas medical and educational expenses.

The apex bank said this is part of its revised regulatory guidelines BDC operators issued on Friday, February 23, 2024.

The guideline states that there will be a limit on foreign currency purchases for school fees at $10,000 per customer annually.


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