CBN Prolongs BDCs’ Forex Access to May 30, 2025

The Central Bank of Nigeria has prolonged the temporary approval granted to Bureau de Change operators to purchase foreign exchange from the Nigerian Foreign Exchange Market until May 30, 2025.

Over the past year, the CBN has enforced various measures to regulate foreign exchange access and curb speculation, including stricter supervision of BDC operations, enforcement of regulatory compliance, and reforms aimed at achieving exchange rate unification.

This latest extension highlights a strategic approach to balancing forex demand while preserving market stability.

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This extension was outlined in a circular issued on Monday by the Trade and Exchange Department of the apex bank, permitting BDCs to continue acquiring forex from authorised dealers under the same conditions.

The circular, referenced TED/FEM/PUB/FPC/001/003 and signed by Dr. W. J. Kanya, the acting Director of the Trade & Exchange Department, referred to an earlier directive TED/FEM/PUB/FPC/001/030 issued on December 19, 2024.

The previous circular had allowed existing BDCs to source foreign exchange from authorised dealers with a weekly limit of $25,000.

Originally set to expire on January 31, 2025, the directive has now been extended by four months, until May 30, 2025.

The CBN confirmed that all other terms and conditions stated in the previous circular remain unchanged.

The circular stated, “We refer to our circular TED/FEM/PUB/FPC/001/030 dated December 19, 2024, which granted temporary access to existing BDCs to the NFEM for the purchase of FX from Authorised Dealers, subject to a weekly cap of USD25,000.00.

“The expiry date of January 31, 2025, which was granted in the above-mentioned circular, has been extended to May 30, 2025.

“All other terms and conditions in the above-mentioned circular remain unchanged.”

The CBN remains dedicated to ensuring a fully operational foreign exchange market and will continue providing liquidity when necessary to manage price fluctuations.

Nigeria’s foreign exchange reserves saw a notable decline in January 2025, decreasing by $1.11bn over the month.

As per data from the CBN, the nation’s reserves stood at $40.88bn on January 2 but had dropped to $39.77bn by January 30, marking a 2.72 per cent decline within the month.

This reduction in reserves results from the CBN’s ongoing interventions in the foreign exchange market, external debt servicing, and capital outflows.

Although the naira experienced significant appreciation within the same period, the decrease in reserves indicates that the CBN may have utilized a portion of its FX reserves to stabilize the local currency and regulate liquidity in the official market.

By sustaining forex access, the apex bank seeks to improve liquidity in the retail market, ensuring that BDCs can meet the demand for personal and business-related transactions.