The Central Bank of Nigeria (CBN) has introduced new measures to achieve a market-determined exchange rate for the Naira. The move comes as part of ongoing reforms to curb price distortions and reduce the widening exchange rate premium observed in recent times.
A key initiative announced by the CBN is the approval for the sale of foreign exchange to eligible Bureau De Change (BDCs) operators to meet the demand for eligible invisible transactions. Each BDC will be allocated $20,000 at N1,301 per dollar, based on the lower band rate of executed spot transactions at the Nigeria Autonomous Foreign Exchange Market (NAFEM) for the previous trading day.
To ensure transparency and prevent exploitation, all BDCs are mandated to sell foreign exchange to end-users at a margin not exceeding one percent above the purchase rate from the CBN.
Furthermore, the CBN has directed eligible BDCs to make Naira payments to designated CBN Foreign Currency Deposit Naira Accounts and submit confirmation of payment, along with other necessary documentation, for disbursement at specified CBN branches in Abuja, Awka, Lagos, and Kano.
Dr. Hassan Mahmud, Director of the Trade and Exchange Department at the CBN, emphasized the importance of these measures in stabilizing the foreign exchange market and curbing the proliferation of parallel market activities.
