Naira drops to 900/$, CBN promises to crack down on BDC operators | The Lafete Magazine

Naira drops to 900/$, CBN promises to crack down on BDC operators

On Wednesday, the naira lost value in the black market versus the US dollar, ending the day at 900/dollar.

This happened just two weeks after the local money was being sold on the illegal market for 960 dollars.

The naira’s upward trend in recent days was reversed as the illegal market once more experienced a shortage of dollars.

Earlier this week, the local currency fluctuated between 850 and 880 to the dollar.

The naira decreased on Wednesday to 773.42/$ in the Investor & Exporter window and in the parallel market. On Tuesday, the I&E Window’s local exchange rate had reached 757.10/$.

On Wednesday, bureau de change employees in Lagos, Kano, Abuja, and airports quoted the dollar between 895 and 905 per unit.

Sanusi Ibrahim, a BDC employee at the Lagos airport, told The PUNCH that “We bought and sold the naira today at 890/$ and N900/$.”

At the Central Business District in Abuja, a BDC operator, Yusuf Kareem, said, “The dollar is still scarce. We sold for N900 today.”

At the Allen Avenue Ikeja, Lagos, Alhaji Gambo Aliu, a currency dealer said he told the greenback at 905/dollar.

As naira continued to defy efforts to tame its slide, the Central Bank of Nigeria has threatened to revoke operating the licences of BDCs who violated its rules.

The President, Association of Bureau De Change Operators of Nigeria, Aminu Gwadabe, confirmed this after a sensitisation engagement with BDC operators.

“At a sensitisation engagement between the CBN and our compliance officers across the zones, the apex bank reiterated that by 31st of August, 2023, any operator that breaches its circular on the allowable margin of -2.5 per cent and +2.5 per cent on average weighted rate of I&E closing rate, rendition of returns and payment of penalties, risks the revocation of the operating licence,” he said.

The operational framework enabling BDCs to trade foreign currency at rates comparable to those available on the Investor & Exporter forex window was unveiled by the top bank on Friday.

It issued the directive to BDCs in a circular titled “Operational mechanism for Bureau de Change operations in Nigeria” and dated August 17, 2023.

It read in part, “The spread on buying and selling by BDC operators shall be within an allowable limit of -2.5 per cent to +2.5 per cent of the Nigerian exchange market window weighted average rate of the previous day.

“Mandatory rendition by BDC operators of the statutory periodic reports (daily, weekly, monthly, quarterly and yearly), on the financial institution forex rendition system which has been upgraded to meet operators’ requirements.”

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