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Today’s Black Market Exchange Rate In Nigeria

The operation of the foreign exchange market in Nigeria is characterized by prices that are not supported by the Central Bank of Nigeria (CBN), but the popularity of the black market rate in the FX market could be attributed to the apex bank.

What is the current Black market Exchange Rate in Nigeria?

We track the rates on more than three sites for the latest rate of the black market, so, this page shows Dollar to Naira, EUR to Naira, and Pound to Naira rates in the morning, afternoon, and the evening trading session between buyers and sellers.

Morning Trading Sessions

Dates Currencies Buy (NGN) Sell (NGN) Source
Oct 21, 2022 USD 745 755 BDC/Aboki rate
Oct 21, 2022 GBP 828 836
Oct 21, 2022 EUR 720 728
         
Oct 21, 2022 USD 745 755 Bank Transfer or Inflow rate
Oct 21, 2022 GBP 830 850
Oct 21, 2022 EUR 720 738

Afternoon Trading sessions

Dates Currencies Buy (NGN) Sell (NGN) Source
Oct 21, 2022 USD 750 755 Aboki rate
Oct 21, 2022 GBP 835 845
Oct 21, 2022 EUR 722 732
         
Oct 21, 2022 USD 747 757 Bank Transfer or Inflow rate
Oct 21, 2022 GBP 835 850
Oct 21, 2022 EUR 722 742

Evening trading sessions:

Dates Currencies Buy (NGN) Sell (NGN) Source
Oct 21, 2022 USD 750 755 Aboki rate
Oct 21, 2022 GBP 835 845
Oct 21, 2022 EUR 722 732
         
Oct 21, 2022 USD 747 757 Bank Transfer or Inflow rate
Oct 21, 2022 GBP 835 850
Oct 21, 2022 EUR 722 742

To make that this page reflects the prevailing rate at the unofficial FX market, this page shall be updated in the morning between 8:30 AM to 11:00 AM; in the afternoon between 12:30 to 2:30 while the evening trading sessions that be updated between 4:00 PM to 6:00 PM

There shouldn’t have been a black market in foreign exchange in the first place. Unfortunately, the government of Nigeria created a policy that led to it a long time ago and it’s now extremely difficult for them to arrest the situation.

What is the black market rate in foreign exchange?

A black market rate is an unofficial price at foreign currencies like USD, GBP, and EUR are exchanged against the local currency in a country e.g Nigeria’s official currency. In Nigeria, for instance, there is a wide margin between the official rate and the unofficial rate.

At the time of this report, the CBN official rate was NGN430.37 while the parallel rate was NGN712. That’s a margin of NGN281.63. The naira is among the top worst-performing currencies against the USD in research by Prof. Steve Hanke

The black market is usually referred to as an illegal market that is operated outside the official regulations. In the FX market, it is the responsibility of the Central Bank of Nigeria (or the apex bank of any country) to intervene regularly to prevent the naira from losing its value against its peers at the FX market.

Why Black market rate in the Forex market?

If the apex bank fails to enforce its policy, the market will become a free-for-all whereby every seller and buyer operates an exchange rate that favors both parties.

What happens in an economy where the black market reigns is that the apex bank losses part of its monetary control, especially when the official rate is not accessible to investors.

The popularity of the black market in Nigeria creates a more porous foreign exchange. It also put pressure on the naira. It makes FX users see the black market rate as their ‘savior’ in times of emergency.

For instance, getting approval to meet foreign school fees needs on the CBN’s TMS for FX takes four weeks or more. The delay pushes a lot of students and importers who need FX for their business to the black market.

TMS means Trade Monitoring System. It is a platform created by Nigeria’s apex bank for Nigerians to submit their applications for FX.

Dramatic changes in the Black market exchange rate

There has been a dramatic change in the margin between the official rate and unofficial rate within a period of two-year.

For instance, one US Dollar is exchanged at NGN470 by the end of 2020 (December 31) at the unofficial market through the New Year (2021).

But before the end of November 2021, the USD had gained more against Nigeria’s currency as it ended the month at NGN540 to USD as can been seen in the USD to naira article.

Methodology:

The rates you see on this page are based on trading between buyers and sellers on FX black market tracking platforms like ngnrates.com, nairablackmarket.com, Peer-to-Peer platforms (P2P), and FX traders popularly called aboki on the streets of Allen, Ikeja, Lagos, Nigeria’s commercial capital.

Conclusion:

The official exchange rate is the rate set by the Central Bank of Nigeria (CBN). It is one of the monetary policies of the apex bank.

The unofficial foreign exchange market rate is unregulated, it is considered illegal and anyone who trades in this market could be arrested if the apex bank is determined to exercise its monetary power as we saw in the case of CBN vs abokifx.com in 2021.

The black market exchange rate of USD to the Naira you would get in Lagos may not be the same rate in Ibadan, Abeokuta or Kaduna.

The economic activities as it relate to travelling in and out of investors and traders plus demand play a huge role in the rate you get in your location.

References:

  1. Saylordotorg. “Black Markets”. github.io.
  2. Naira Black Market. “Black Market exchange Rates”. nairablackmarket.com
  3. Central Bank of Nigeria. “Exchange Rates.” cbn.gov.ng
  4. NG Nrates. “Black Market”. ngnrates.com

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