Aminu Gwadebe, the President of the Association of Bureau De Change Operators of Nigeria (ABCON), has strongly recommended that the Central Bank of Nigeria (CBN) take immediate action to harness the potential of the BDCs. Gwadebe’s suggestion entails granting BDCs access to banks’ autonomous windows and the agency of international money transfer operators. This strategic move is aimed at injecting much-needed liquidity into the retail segment of the foreign exchange market, thereby stemming the rapid decline of the Naira resulting from the scarcity of forex in the nation.

Furthermore, Gwadebe has advocated for the revival of the CBN’s policy guidelines from 2015, which would empower BDCs to effectively infuse liquidity into the retail sector through various forex windows. The 2015 policy guidelines would empower BDC operators to tap into foreign exchange reserves from commercial banks’ autonomous window, as well as act as intermediaries for diaspora remittances.

Highlighting the instrumental role of BDCs in the CBN’s transmission mechanism, Gwadebe emphasized, “I am compelled to suggest that the apex bank harness the capabilities of BDCs by granting them access to banks’ autonomous window and agency services of international money transfer operators.”

Expressing concerns over the actions of some International Money Transfer Organizations (IMTOs), Gwadebe also disclosed that commercial banks have disclosed the alarming diversion of diaspora remittances by certain IMTOs. The revelation has raised questions about the effective utilization of these funds, as many remittances appear to be untraceable within the banking system.

“Imagine you are the IMTO and then you are the one that will pay the beneficiary the naira, invariably, then I as well just give you the naira without paying you the dollar.’’

“Even the banks have been saying that they are not seeing the diaspora remittances that the fintechs have taken over. We had a meeting with the banks where we even tried to bring up the issue of diaspora remittances so that we can harness it and bring liquidity, but they said they don’t see it. That’s the truth of the matter, a lot of unlicensed online firms are in the process.’’

The black market rate fell to as low as N950/$1 last week, opening up about N200 disparity with the I&E window as demand continued to outstrip supply. Meanwhile, the official rate averaged N765/$1.

As stakeholders await potential shifts in CBN policy, Gwadebe’s recommendations underscore the pivotal role that BDCs can play in restoring stability to Nigeria’s foreign exchange market and ensuring the transparent flow of diaspora remittances.

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