Banks Ignoring CBN Directive to Sell Forex to BDCs—ABCON

The forex traders, under the aegis of the Association of Bureaux de Change Operators of Nigeria (ABCON), said some banks did not comply with the directive of the Central Bank of Nigeria (CBN) for the sale of FX to BDCs at the official rate.

Last year, the central bank allowed BDC operators to access about $25,000 weekly through the Electronic Foreign Exchange Matching System (EFEMS) for 42 days, which expired a few days ago.

But last week, the CBN, a circular signed by its acting director of the Trade and Exchange Department, Mr W. J. Kanya, extended this window to May 30, 2025, in a bid to ensure the stability of the Naira.

The circular, titled Sales of Foreign Exchange To BDCs To Meet Retail Market Demand For Eligible Invisible Transactions, shifts the previous deadline of January 31 to May 30.

It extends the temporary access granted to BDCs to the NFEM for purchasing FX from authorised dealers, subject to a weekly cap of $25,000.

Commenting on this development, the president of ABCON, Mr Aminu Gwadabe, said the extension demonstrates the commitment of the CBN to stabilising the FX market, noting that it promotes inclusiveness through EFEMS.

However, expressed concern that banks failed to comply with the initial notice of the apex bank in December 2024, which instructed them to sell forex to BDCs, urging them to support the CBN and comply with the latest directive.

“ABCON and its members indeed received the news as a good development. We considered it as part of the CBN efforts at ensuring continuity and its determination for the inclusiveness of our sub-sector in the EFEM Market.

“We, however, call on all money deposit banks to partner with CBN and our members in the implementation of this circular to ensure liquidity in the retail end sector and the naira’s ongoing stability.

“On behalf of my members, I extend my sincere gratitude to the CBN management for their flexibility and transformative leadership. I assure them that we will continue to serve as a vital third-leg mechanism, committed to eliminating volatility and narrowing the gap between the parallel market and the EFEM market,” he said.