By Babajide Komolafe

Bureaux De Change in the country has appealed to the Central Bank of Nigeria (CBN) for an increase in the weekly sale of foreign exchange to each operator.

The BDCs also asked the CBN to extend its occasional intervention in the foreign exchange market to their sector, so as to reduce demand pressure at the retail end of the market. Speaking under the aegis of Association of Bureaux De Change Operators of Nigeria (ABCON), the BDCs lamented that while over 2000 operators have laboured to comply with the N35 million mandatory caution deposits, the $15,000 weekly sale to each BDCs by the CBN is inadequate to cover operating costs.

“Considering the difficulties that BDCs are currently facing, due to the volume of the weekly sales granted to BDCs as against the associated costs in the business, we are strongly suggesting that the CBN should consider increasing the weekly sales to BDCs from $15,000 to $50,000, the Association said in an appeal letter to the CBN Governor.

Making a case for extension of CBN forex intervention to BDCs, the Association said, “

Given the ever increasing demand of US$ as against the rigidity of the weekly official sales to BDCs, we have noted that a good number of our members hardly meet up their demands from end-users.

Now, to assist in achieving the aim of exchange rate stability in the events of increase in demand of dollar and static sales of $15,000 to a BDC, we are suggesting that, for now, the Central Bank should consider granting our sub- sector periodic sales intervention as it does to Banks.

For instance, on 24th September, 2014 by Retail Dutch Auction System, the CBN sold a total of N350 million to Banks, while on 29th September, 2014 and 8th October, 2014, totals of N500million and N400million respectively were also sold to banks making a sum of US$1.250billion within a period of 13 days. Statistically speaking, the sum of $15,000.00 is sold to a BDC per week, giving a total of about $37,500,000-00 to BDCs per a week.”

The Association also appealed to the apex bank to reduce the mandatory caution deposit to N15 million from N35 million, to free up cash for BDCs to meet day-to-day operations.

“After the expiration of the deadline for the payment of the increased caution fee of N35million, we noticed that a good number of Bureau de Change Operators could no longer conveniently carry out their weekly trading due to lack of cash.

“To avoid the possibility of such BDCs closing shop even after having made the effort to pay their caution fees, we are sincerely pleading that the Central Bank should consider the possibility of reviewing the caution fee from N35million to N15million in order to financially empower the BDCs to carry on their weekly trading”, it said.