The Central Bank of Nigeria (CBN) has unveiled a temporary foreign exchange policy aimed at easing forex pressures during the festive period.
From December 19, 2024, to January 30, 2025, Bureau de Change (BDC) operators are authorised to purchase up to $25,000 weekly from the recently launched Nigerian Foreign Exchange Market (NFEM).
This measure is designed to meet the heightened demand for foreign exchange that typically accompanies the Christmas and New Year celebrations.
In a circular issued on December 19, 2024, and signed by T.G. Allu on behalf of the acting Director of the Trade and Exchange Department, the CBN stated that the policy is temporary and meant to address seasonal forex requirements.
CBN’s Terms and Conditions for BDC Operators
The CBN has laid down specific guidelines for BDC operators under the new policy.
The forex must be purchased from a single authorised dealer chosen by the BDC operator.
BDC operators are required to fully fund their accounts before accessing the market.
Transactions must occur at the prevailing NFEM rate, with a maximum 1 per cent spread allowed on pricing to retail customers.
All transactions under this arrangement are to be reported to the Trade and Exchange Department of the CBN.
Circular Highlights CBN’s Intentions
The circular reads:
“To meet expected seasonal demand for foreign exchange, the CBN is allowing temporary access for all existing BDCs to the NFEM for the purchase of FX from authorised dealers, subject to a weekly cap of $25,000 (Twenty-five thousand dollars only). This window will be open between December 19, 2024, and January 30, 2025.”
The CBN added that this intervention is part of its broader effort to ensure a liquid and fully functional foreign exchange market during a period of high demand.
A Lifeline for the Festive Season
The holiday season is known for increased travel, heightened business activities, and greater spending by Nigerians.
Many individuals and businesses need foreign exchange for personal travel, business trips, and seasonal imports.
The new policy is expected to provide relief for retail end-users and businesses grappling with forex shortages.
One financial analyst, John Adegbite, described the move as a “welcome development.”
“This is a critical intervention by the CBN, considering the usual spikes in forex demand during the Yuletide. It will help stabilise the market and prevent price volatility,” Adegbite said.
Maintaining Access for Personal and Business Travellers
The CBN has also assured the public that Personal Travel Allowance (PTA) and Business Travel Allowance (BTA) will remain accessible through commercial banks.
These transactions, the apex bank said, will be conducted at market-determined exchange rates under the NFEM framework.
A bank official, who requested anonymity, praised the initiative but emphasised the need for strict monitoring.
“While this move will ease some pressure, there must be proper oversight to prevent abuse by unscrupulous actors,” the official noted.
