CBN Mandates Electronic Portal, Stricter Due Diligence for BDCs in FX Market Overhaul

The Central Bank of Nigeria (CBN) has introduced a significant regulatory overhaul for Bureau De Change (BDC) operators’ foreign exchange (FX) purchases, unveiling a new electronic portal and tightening compliance measures. This initiative aims to bolster transparency, enforce adherence to regulations, and ensure sustained liquidity within Nigeria’s retail FX market.

In a circular dated July 15, 2026, signed by Aderinola Shonekan, Director of the Trade and Exchange Department, the apex bank detailed the operational and regulatory modalities for BDCs accessing FX through Authorised Dealer Banks. This framework builds upon the CBN’s February 10, 2026 circular, which initially granted licensed BDCs this access. The latest guidance specifies eligibility criteria, application procedures, confirmation and settlement processes, reporting obligations, weekly purchase limits, and the treatment of unutilised FX balances. Both Authorised Dealer Banks and BDC operators are directed to comply immediately, with breaches facing regulatory sanctions.

Under the revised framework, only BDCs holding valid and subsisting CBN licences are eligible. Operators under regulatory sanctions, licence suspension, or operational restrictions will be excluded until such measures are lifted. The CBN has also imposed fresh due diligence obligations on Authorised Dealer Banks, mandating comprehensive Know-Your-Customer (KYC) and Customer Due Diligence (CDD) checks. Banks must retain corporate documents, conduct enhanced due diligence for high-risk BDCs, and update customer records annually or upon material changes. Crucially, FX will not be disbursed to any BDC failing to meet these prescribed due diligence requirements.

A centralised FX BDC Purchase Tracker (FXBT) will be maintained by the CBN for real-time registration and submission of purchase data, enhancing regulatory oversight. The framework preserves BDCs’ right to select any Authorised Dealer Bank, prohibiting exclusivity arrangements or referral fees. Banks must acknowledge purchase requests within two business hours and provide clear electronic notification of approval or rejection, citing specific reasons such as incomplete KYC, exhaustion of weekly purchase caps, or compliance issues.

Settlement procedures require all FX transactions between BDCs and banks, as well as with end-users, to be conducted through accounts held with licensed financial institutions. Third-party transactions are prohibited, with FX purchased by BDCs to be credited solely to their registered settlement accounts. Unutilised FX purchased through the Nigerian Foreign Exchange Market must be sold back to the market within 24 hours of the utilisation period’s expiry, or face sanctions including forfeiture and suspension. BDCs must disclose previous week’s unutilised balances in new purchase requests, and banks must incorporate these into weekly cap calculations. Licensed BDCs are also required to continue filing electronic returns detailing weekly FX purchases, sales, unutilised balances, and settlement breakdowns. Violations carry penalties ranging from monetary fines and NFEM access suspension to licence revocation and referral to law enforcement for suspected criminal conduct.

… CBN Mandates Electronic Portal, Stricter Due Diligence for BDCs in FX Market Overhaul … Naijaonpoint.