BDC Operators Demand New FX Window Amid Weaker Naira

The Association of Bureau de Change Operators of Nigeria has requested the Central Bank of Nigeria to establish an autonomous trading window for BDC currencies with a fixed maximum daily limit.

This, according to the association, will allow eligible BDCs to access dollars from banks, the autonomous market and the diaspora forex widow at prevailing market prices.

Traders have also called for an improvement to existing BDC automation portals to file transaction reports on the CBN/ABCON/Nigerian Financial Intelligent Unit/Nigeria Inter-Bank Settlement System Plc portals for effective regulatory monitoring and supervision.

The body also called for the creation of an automation portal to encourage the registration of undocumented and unlicensed operators for effective monitoring, identification and tracking of their transactions.

ABCON believes that the proposal will save the naira from further decline and improve the stability of the exchange rate.

This was in a statement released by BDC operators. The body spoke as the country continues to face a shortage of foreign currency in the economy.

In the statement, the body claimed that the naira was trading at 596/dollar in the parallel market and 415.83 to the dollar in the official market, creating a rate differential of 180.17 naira per dollar.

ABCON’s National Executive Council said the “measure to save the naira” had been accepted by the body after its meeting in Lagos, where it unveiled strategies to “save the local currency, close the gaps in interest rates exchange rate and reduce volatility in the foreign exchange market”. ‘

ABCON Chairman Alhaji Aminu Gwadabe said there was an urgent need to improve dollar liquidity in the market and ensure price stability in the economy.

These measures, he said, would save the local currency and economy from the impact of election spending that has kept inflation in double digits for a very long time.

The ABCON boss claimed that the depreciation of the naira against global currencies was due to the pressure of growing demand for dollars without sufficient liquidity to meet the demands of retail end users, manufacturers and other key players in the industry. the economy.

He said: “The naira has constantly come under serious pressure due to the scarcity of the dollar, making it difficult for forex end users, manufacturers and key industry players to access the dollar needed to meet to their needs.

“ABCON, under my leadership, will continue to encourage our members to play the vital role of bridging the exchange rate gaps in the market and reducing the widening of the premium between the parallel market and the official window.”

Gwadabe listed several factors that continue to undermine the stability of the naira and the value of the local currency against other currencies.

Following the decision of the Central Bank of Nigeria to halt the sale of foreign exchange to the BDCs, ABCON continued to make repeated calls for the restoration of the sale of foreign exchange.

The CBN, however, argued that it could not resume foreign exchange sales to BDCs anytime soon.

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