The Central Bank of Nigeria (CBN) has updated its regulatory guidelines for Bureau De Change (BDC) operators, following consultations with stakeholders. Key changes include the removal of the mandatory caution deposits of N200 million for tier-1 BDC license holders and N50 million for tier-2 license holders. Additionally, the non-refundable annual license renewal fees of N5 million for tier-1 BDCs and N1 million for tier-2 BDCs have been withdrawn.
These adjustments aim to streamline BDC operations and enhance financial accessibility. The Director of the Financial Policy and Regulation Department, Haruna Mustafa, announced these changes in a circular posted on the CBN’s website on Wednesday. Mustafa emphasized that existing BDCs must re-apply for a new license based on their preferred tier or category as specified in the updated guidelines. New applicants for BDC licenses must meet the conditions specified for their chosen category.
Existing BDCs are required to meet the minimum capital requirements for their selected license category within six months from the effective date of the guidelines. The revised guidelines also update permissible activities for BDCs to ensure they align with market needs and regulatory standards. BDCs are expected to comply with corporate governance requirements and provisions related to anti-money laundering, counter-terrorism financing, and counter-proliferation financing.
The CBN will begin receiving and processing license applications from the effective date of the new guidelines. Interested applicants should submit their information electronically to bdclicense@cbn.gov.ng, including the name of the promoter, the proposed BDC name, the promoter’s email address, and phone number.
These new guidelines replace the Revised Operational Guidelines for Bureau De Change in Nigeria issued in November 2015, along with all related circulars and directives. The updated Regulatory and Supervisory Guidelines for BDC Operations will take effect on June 3, 2024.
The circular partly read, “As part of reforms to re-position the Bureau De Change (BDC) sub-sector to play its envisioned role in the foreign exchange market in Nigeria, the Central Bank of Nigeria (CBN) issued the Draft Operational Guidelines for BDC Operations in Nigeria in February 2024, for stakeholder comments/inputs.”
“Following the conclusion of the stakeholder consultations and in the exercise of the powers conferred on it by Section 56 of the Banks and Other Financial Institutions Act (BOFIA) 2020, the CBN hereby issues the attached Regulatory and Supervisory Guidelines for Bureau De Change Operations in Nigeria 2024 for compliance by all operators and promoters of proposed BDCs in Nigeria.”
“The guidelines, amongst others, introduce new licensing requirements and categories of BDCs as well as revise the permissible activities, financial requirements, corporate governance requirements and AML/CFT/CPF provisions for BDCs.”
“All existing BDCs shall: Re-apply for a new license according to any of the Tiers or license categories of their choice as provided in the Guidelines.”
“Meet the minimum capital requirements for the license category applied for within six (6) months from the effective date of the Guidelines.”
“Applicants for New BDC License Applicants for a new BDC license are required to meet the conditions for the grant of license in accordance with the Tier or category of BDC chosen as stipulated in the Guidelines. Receipt and processing of applications for license shall commence from the effective date of the Guidelines.”