Dollar sales to Bureaux De Change (BDC) increased to $50,000 weekly

The Central Bank of Nigeria (CBN) yesterday increased banks’ weekly Diaspora-related foreign exchange (forex) sales to Bureaux De Change (BDCs) from $30,000 to $50,000.

Addressing reporters after the Bankers’ Committee meeting in Abuja, the Group Managing Director/CEO of United Bank for Africa (UBA) Plc, Kennedy Uzoka, said the increase was to ensure that more operators have access to the dollar.

He said it would also enable more people get enough dollars to pay school fees abroad and procure Business Travel Allowance (BTA) and Personal Travel Allowance (PTA).

Members of the committee urged BDCs to approach banks and apply for forex. They said the decision was not a reversal of the committee’s earlier policy, but meant to ensure that the country surmounts its currency crisis.

Acting CBN Director of Corporate Communications Isaac Okorafor said the apex bank “will now monitor strictly to ensure that people do not abuse the process”.

Reacting, Association of Bureau De Change Operators of Nigeria (ABCON) President Aminu Gwadabe  expressed surprise at the increase at a time he said banks were finding it difficult to meet the $30,000 limit.

Many of the banks, he said, were not even selling to BDCs, but preferred to return the cash to the CBN because of the limited time they can hold the funds. “We should be happy that the volume has been increased but unfortunately, the majority of the BDCs in Port Harcourt, Kano, Benin and other states are not getting the funds,” he said.

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Gwadabe said the BDCs started funding their accounts since last week, adding that many of them could not even access $10,000 weekly let alone $30,000 or now $50,000.

He said the banks had not even sold dollars to the BDCs they cleared for complete documentation, adding that only 10 out of 100 cleared BDCs got the fund.

The practice, he said, made it difficult for the naira to appreciate noting that the local currency exchanged at N388/ N390 to the dollar yesterday.

The CBN, he said, should include the BDCs in the Bankers’ Committee meetings to ensure that their voices were heard.

CBN’s Director of Banking Supervision Mrs. Tokunbo Martins said a decision was taken at the end of the committee’s meeting to start disbursing the special intervention fund to support primary agricultural projects and core manufacturing.

She said: “The CBN took from the bank’s cash reserves called the special intervention fund, that fund has been with the CBN for some time.”

This special intervention fund, she said, would be “for projects that support import substitution, projects that will help protect foreign exchange such that whatever we were importing before can be manufactured.”

This fund, she added “will be released to this kind of projects, it will not be released to any kind of project and once these funds are released there will be some ease on the system and there will be more liquidity; so important projects will get financing at a lower single digit interest rate.”

Martins said the decision to get banks to write off their Non-Performing Loans (NPLs) was not  arbitrary,  adding “only NPLs that have been fully provided for in the books for the banks are those that can be written off and not an arbitrary right off of NPLs.”

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Zenith Bank Managing Director Peter Amangbo said in keeping with the coming celebration of World Savings Day, all banks in Nigeria will break into different groups to cover all the local government areas to sensitise those at the grassroots on the need to save massively.

Amangbo said the exercise “is to grow the pool of funds available for lending and the need to save.”

The Zenith Bank boss noted: “There will always be disparity in savings and interest rate stressing,” that the gap is not as wide as people think it is and the longer people save the more interest they will earn.

On CBN’s directive to banks to open savings account with zero amount, Amangbo said the decision was not new, adding that it has been in effect for about two years now. According to him, “there are lots of accounts that can be opened with minimal documentation.”

On the need to have bank branches in all parts of the country, Amangbo said: “You don’t need brick and mortar branches any more because mobile apps are now game changers as a result there is no need to have branches in local government areas (LGAs).

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