The Association of Bureaux De Change Operators of Nigeria (ABCON) has called on the Central Bank of Nigeria (CBN) to increase the margin allowed BDCs on foreign exchange transactions.
Making this appeal at a webinar organised by the association, ABCON President, Aminu Gwadabe, said the N2 margin per dollar presently allowed by the CBN is inadequate in view of the huge operating cost of BDCs.
It said in a statement titled, Resumption of Foreign Currency Sales to BDCS; COVID-19 challenges, Compliance and Way forward”, arising from a webinar put in place to sensitise BDC operators on the processes put in place by the CBN and ABCON to ensure seamless dollar purchase by members of the public through BDCs.
Citing the example of other countries where BDCs enjoy up to six per cent margin per dollar, Gwadabe stressed that even the N2 per dollar allowed by the CBN is not up to the three percent margin preiously allowed by the apex bank at the commencement of the dollar sale scheme”.
He said: “The challenge that we are facing is the smaller margin. Right now, the parallel market is doing about N430 and our pegged rate is N386 to the dollar. So, we still see a gap between the advised exchange rate of N386 by the CBN and what is obtainable presently in the market. cannot cover our cost of operation.
“We are asking the CBN to please look at this and review it for us,” Gwadabe said, urging the CBN to allow for the use of virtual documentation which he said would help in curbing the spread of the Covid-19 pandemic.”
Gwadabe stated that in addition to low margin, other challenges confronting BDCs include limited scope of operation, rigorous documentation and the penelities levied on erring operators.
Stressing that the ABCON has always supported sanctioning of erring members, Gwadabe said there is need for the apex bank to review some of the penalties, given the severe impact of COVID-19 on the operations of BDCs.
While assuring the CBN of the continued cooperation of ABCON in ensuring stable exchange rate and compliance with regulatory requirements by BDCs, Gwadabe commended the apex bank for the resumption of dollar sales to BDCs.
