Amidst the recent strengthening of the Naira against the US dollar, the Association of Bureaux De Change Operators of Nigeria (ABCON), representing all Central Bank of Nigeria (CBN)-Licensed Bureaux De Change (BDCs), has urged the Apex Bank to revise downwards its current Exchange Rate, currently set at N1,251/$ for BDCs,leadership reports.
ABCON highlighted this appeal in light of the unprecedented milestone achieved by the CBN, where for the first time in 15 years, unofficial market rates reached N1,235/$, lower than the official BDCs buying exchange rate of N1,251/$ (plus 1.5 per cent margin) set by the CBN in its latest intervention.
The association emphasized that the rapid recovery of the Naira, surpassing expectations, has rendered the CBN’s selling rate to BDCs relatively expensive and challenging to market to retail buyers who seek more competitive rates from unregistered forex operators, bypassing BDC services.
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In a letter addressed to the Director of the CBN’s Trade & Exchange Department, signed by ABCON’s National President, Alhaji (Dr.) Aminu Gwadabe, ABCON further expressed concerns regarding delays in the allocation of dollars to many BDCs despite their funding, leading to potential exchange rate risks and significant financial losses.
The group noted that with the Naira appreciating across markets, many BDCs who purchased dollars at N1,251/$ face substantial income and capital losses if they sell at the current open market rate of N1,235/$. Consequently, ABCON urged for a downward review of the applicable exchange rate to mitigate such losses and bolster the stability of the Naira.
“We have observed a troubling trend where numerous members who paid for dollar allocations at N1,251/$ with a 1.5% margin are yet to receive disbursements. This occurs in the context of the prevailing open market rate of N1,235/$, which is lower than the authorized applicable exchange rate set by the CBN for BDCs,” the statement concluded.
