According to research, the Bureau De Change [BDC] can be seen as a firm that is licensed to provide small-scale foreign exchange services in Nigeria and whose primary purpose is to do such activity on a stand-alone basis.
The Nigerian Association of Bureaux De Change Operators has urged the Central Bank of Nigeria to establish an Autonomous Foreign Exchange Trading window for BDCs with a predetermined maximum daily limit.
This, according to the organization, this will let qualifying BDCs to get dollars from banks, the autonomous market, and the Diaspora forex widow at market rates.
The forex dealers also suggested that current BDC automation portals be improved so that transaction returns may be filed on CBN/ABCON/Nigerian Financial Intelligent Unit/ Nigeria Inter-Bank Settlement System Plc websites for effective regulatory monitoring and supervision.
The body also advocated the formation of an automated portal to encourage the registration of undocumented and unlicensed operators in order to effectively monitor, identify, and trace their transactions.
ABCON believes the idea will keep the naira from falling further and ensure price stability in the economy.
This was stated by the BDC operators in a statement. The country continues to struggle with a currency shortage.
According to the statement, the naira was trading at 596/dollar on the parallel market and 415.83 to the dollar in the official market, resulting in a rate differential of N180.17 per dollar. The ABCON National Executive Council announced the “effort to rescue the naira” during its meeting in Lagos, where it detailed plans to “save the native currency, bridge exchange rate gaps, and reduce volatility in the FX market.”
ABCON President Alhaji Aminu Gwadabe stated that there is an urgent need to increase dollar liquidity in the market and make sure there is stable price in the economy.
These efforts protect the local currency and economy from the effects of election expenditure, which had maintained inflation in the double digits for a long period. The ABCON chairman argued that the naira's decline versus world currencies was caused by increased dollar demand and a lack of liquidity to fulfill the demands of retail end users, producers, and other major actors in the economy.
“The naira has always been under a lot of strain as a as a result of dollar shortages, making it difficult for FX end users, manufacturers, and key industry participants to get the dollar needed to satisfy their demands,” he added.
“ABCON, led by myself, will continue to encourage our members to play an important role in lowering market exchange rate disparities and reducing the increasing premium between the parallel market and the official window.” Gwadabe cited many issues that continue to weaken the naira's stability and value relative to other currencies. Following the Central Bank of Nigeria's decision to halt the sale of currency to BDCs, ABCON has made repeated appeals for the sale to resume.
The CBN, on the other hand, has stated that it may not resume currency sales to BDCs anytime soon.
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