Naira records massive gain at official market as CBN withdraws operating license of over 2k forex dealers

The Central Bank of Nigeria (CBN) has released an updated list of approved Bureau De Change (BDC) operators in the country.

The apex bank in a document titled ‘Approved BDCs’, published on its website on Tuesday, July 18, 2023 revealed that the licenses of 2,698 BDCs have been withdrawn.

Legit.ng observed that the total number of BDC dealers now approved to operate in the country is 2,991 from over 5,000.

CBN exchange rate fight

Since President Bola Ahmed Tinubu assumed office, the CBN has embarked on several exchange rate reforms, most notably the floating of the naira.

This is in a bid to strengthen the Nigerian currency, which has so far failed to yield results.

Over the last few years, BDCs (Bureau De Change) have become major influencers of the naira's exchange rates against foreign currencies, as the number of operators rose from just 74 in 2005 to 5,689 in 2021.

The huge number of players has created market distortion, leaving the CBN with little influence in tackling the devaluation of the Naira.

Tinubu's new economic advisers recently released a document titled, ‘Policy Advisory Council Report: National Economy Sub-committee,’ which asked for the implementation of key reforms, one of which is raising the capitalization for BDC operators.

Another suggestion by the committee was for the CBN to allow Nigerian banks to operate as the primary dealers to supply the forex market.

Naira records massive gain

The Nigerian currency recorded a massive gain at the official foreign exchange market on Tuesday, July 18, 2023.

According to data obtained from FMDQ, the Nigerian currency closed on Tuesday at N742.93 per dollar.

This marks a massive 6.58% gain when compared to the N795.28 per dollar exchange rate on Monday.

Report says that the recovery recorded on Tuesday is the biggest daily gain in over 4 years at the official market.