Breaking News: CBN Allocates $20,000 to Each BDC to Stabilize the Naira

CBN Takes Decisive Step to Bridge Forex Gap, Allocates $20,000 to Each BDC Operator

In a move to address the widening gap in Nigeria’s foreign exchange market, the Central Bank of Nigeria (CBN) has introduced a significant intervention. According to a recent circular issued by Dr. Hassan Mahmud, the Director of Trade & Exchange Department, eligible Bureau De Change (BDC) operators across the nation will receive an allocation of $20,000 each.

This initiative is part of the CBN’s broader strategy to achieve a market-driven exchange rate for the Naira and mitigate pressures on the parallel market. The allocated funds will be sold at a rate of N1,301 per dollar, reflecting the lower band rate of executed spot transactions at the Nigerian Autonomous Foreign Exchange Market (NAFEM) as of February 27, 2024.

The aim of this measure is to inject much-needed liquidity into the market and stabilize the value of the Naira. Additionally, specific guidelines outlined in the circular mandate that BDC operators sell foreign exchange to end-users at a margin not exceeding one percent above their purchase rate from the CBN. This measure is intended to curb excessive mark-ups and protect consumers from price exploitation.

Eligible BDCs are required to deposit their Naira payments into designated CB Foreign Currency Deposit Naira Accounts and provide confirmation of payment along with other necessary documentation for disbursement. The disbursement will take place at designated CB branches located in Abuja, Awka, Lagos, and Kano.