The Roles of Central Bank of Nigeria (CBN) and Bureau De Change (BDC) in Foreign Exchange Stability.

The financial intermediation of the trio of Central Bank of Nigeria (CBN), Bank and Bureau De Change (BDC) in any growing or developed economy cannot be jettisoned. The main role of the CBN is supervisory and regulatory in nature as the duo of bank and BDC cannot function effectively and efficiently without a grounded CBN. The CBN creates and gives lives to them through rigorous registration and certification procedures, continuous monitoring and supervision, right policies and directive to stimulate growth and development in the country among others.

Bureau De Change (BDC) is a private business licensed by CBN to render service of buying and selling foreign currencies to the public. The main objective of BDC was to serve the retail end of the market by making $5000 or less available to end users for the purpose of private or business travels (PTA or BTA), tuition fee or medical bill payment. The reason for this intermediation seems credible in the face of administrative bottleneck encountered by small end users of foreign currencies from commercial banks.

BDC has over time grown exponentially in Nigeria with allegation of over concentration of licensed operators in a particular section of the country. According to the Association of Bureaux De Change Operators of Nig (ABCON), there are over 5000 of them providing over 15,000 of jobs as at 2020 as well as providing data to help Central Bank in day to day foreign exchange management (Bus. day, Sept 25th 2020). One can deduce therefore that they remain critical and necessary for economic growth.


Excessive profiteering: It is wrong for the owners and operators of BDC to abuse the privilege of serving the public through abnormal margin under the pretence of forces of demand and supply or artificial scarcity since they enjoy subsidy from the CBN. For instance, how can they justify an intervention via weekly auction at 410 USD and trade same for 515 USD? By so doing, they seem to have deviated from their original mandate to make availability of foreign exchange currencies to underserved and unserved segment of the market.

Funding Corruption and Money Laundering: According to the CBN governor, Godwin Emefele, Bureau De Change has become (illegal) wholesale dealers in foreign exchange to the tune of millions of dollars per transaction, proliferation of BDC to obtain forex from CBN, dollarizing the economy etc. What a mismatched of mandate! Instead of being a partner in progress to apex bank, BDC operators have continued to undermine the core objective of CBN to stabilize foreign exchange through round-tripping and other vices. The effort of ABCON at holding its members to account seems little or no effect in the face of the CBN findings.


The growth in BDC operators since CBN began its sale of foreign exchange to the sector has been astronomical from mere 74 in 2005 to almost 5500 as at 27th July, 2021 according CBN, and should give any regulatory body a concern in terms of monitoring and ensuring compliance. CBN waited too late but better late than never.

Similarly, the policy of selling FX to BDC might have been a counter balancing one because Nigeria is the only country in the committee of nations where such policy is in place. Our policy choice must be sustainable going forward.


The regulatory power of Apex Bank is guided under Bank & other Financial Institutions Act (BOFIA) & Foreign Exchange [Monitoring and Miscellaneous Provisions] Act No. 17 of 1995. This power must be used effectively and efficiently at all times to direct, monitor and punish erring bank and others without any fear or favour in the best interest of the society.

It is therefore my considered opinion that the decision of the CBN to exclude BDC from the sale of foreign exchange should help in reducing the burden of monitoring and stabilise the foreign exchange market as all eyes will now be shifted to commercial bank to ensure compliance with foreign exchange guideline.