Forex Crisis: Urgent Need for CBN to Reevaluate Recapitalization Rules for BDCs

The Central Bank of Nigeria’s new recapitalization criteria for its members in the midst of the foreign exchange crisis have drawn criticism from the Association of Bureau De Change Operators.

At the 8th Vanguard Economic Summit on Thursday, ABCON President Aminu Gwadabe revealed this.

Remember that on Wednesday, the CBN released new guidelines for BDC operators in Nigeria.

With the increase in the minimum capital requirements for tier-1 and tier licences to N2 billion and N500 billion, respectively, the apex bank mandated that all BDC operators reapply for licences.

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Gwandabe, however, claims that the CBN’s order for BDC operators to raise their capital base is in violation of international standards and has sought for a reconsideration of the policy.

“You raised the capital base of BDCs from N35 million to N500 million for Tier 2 operators and N2 billion now that you raised the capital from N10 million to N35 million in 2014.” It’s seriously at odds with international norms, Gwadabe declared.

Following four days of appreciation, the Naira declined on Thursday on both the official and parallel FX markets.