Three million Nigerians might lose their livelihoods if Bureau De Change Operators (BDCs) shut down due to their inability to meet the new capital requirements, the Association of Bureau De Change Operators of Nigeria (ABCON) has warned.

In an interview with The PUNCH over the weekend, ABCON President Aminu Gwadebe revealed that fewer than 10% of his members have met the new capital level set by the Central Bank of Nigeria (CBN).

Under the CBN’s May 2024 guidelines, BDCs with Tier 1 licences are required to have a capital base of N2 billion, while those with Tier 2 licences must maintain N500 million. The non-refundable licence fees are N5 million and N2 million, respectively.

According to a November report from ABCON, the Central Bank extended the deadline for BDCs to recapitalise by six months. The new expiration date is Tuesday, June 3, 2025.

Speaking with The PUNCH ahead of the deadline, Gwadebe said: “It’s a tough one. It is glaring that many of us will be out of business. As we speak, I’m not sure that up to 10 per cent have completed the capitalisation process.

Over three million people may lose their livelihoods as a result of this issue, either directly or indirectly. We are talking about 1,500 entities, with employees and families who will be impacted. It’s a disturbing phenomenon, as many of us will hardly meet the deadline.”

The ABCON president added that industry participants have been engaging with the CBN on the recapitalisation issue. Gwadebe asserted that the main challenge in meeting the new capital threshold is its prohibitive nature.

He said: “The amount required is huge—N500 million or N2 billion is not a joke. For a retail entity, a Bureau De Change is just like a bookshop. The model being used for us is entirely a bank model.”

While noting that the model has potential advantages, he pointed out that the industry is losing potential investors due to a lack of enforcement by the CBN.

He explained: “The model comes with some benefits, which they said the Bureau De Change is going to enjoy. But, you know, for me, it’s still going to be a very tall order—except if the CBN enforces some of these benefits.

One of the stated benefits is that the BDCs will be allowed to access the FX market. However, our experience has shown that when the CBN issues circulars instructing banks to sell to BDCs, banks rarely comply.