Banks are diverting dollar sales previously allocated to licensed Bureaux De Change (BDC) operators to unlicensed BDCs or currency hawkers, investigation by Ripples Nigeria has revealed.
An estimated $10 billion may have been sold by the lenders to the currency hawkers in the last four months under the dubious arrangement.
During investigation at bank branches in Ikeja, Ogba and Maryland, and Broad Street in Marina, currency hawkers were seen making huge cash (naira) deposits into their accounts to enable them obtain dollar from the lenders.
Much of the funds, sourced by the banks from unofficial sources especially from the International Oil Companies (IOCs), Diaspora remittances, and dollar earnings by Nigerians at home, are sold to currency hawkers at higher margins of between N280 and N290 to dollar.
The currency hawkers are not guided by Central Bank of Nigeria’s (CBN’s) rules on quarterly foreign exchange (forex) returns filling.
A BDC source who confided in Ripples Nigeria said the 3,000 licensed BDC operators have not only lost over N12 billion in the last four months since the CBN stopped weekly dollar allocations to them, but have not been able to sustain their once thriving businesses.
The source said annual Diaspora remittances to Nigeria alone are estimated by the World Bank at $20.8 billion, even as the BDCs are being denied access to the funds.
The source accused the CBN of closing its eyes to the malpractices in forex market including outright refusal to monitor the rates at which the dollar is sold in the autonomous market.
When contacted, CBN Acting Director of Communications, Isaac Okoroafor, said the regulator does not control transactions taking place in unofficial markets.
President, Association of Bureau De Change Operators of Nigeria (ABCON), Alhaji Aminu Gwadabe confirmed that licensed BDCs are the biggest losers under the CBN’s forex sales policies.
He noted that an average licensed BDC operator makes a minimum of N1 million profit monthly and files returns to the CBN on all its transactions. This comes to average of N3 billion monthly for the 3,000 licensed BDCs.
“The stoppage of dollar sales to licensed BDCs is now in its fourth month, has shown that our members have lost N12 billion within this period and there is nothing being done by the CBN to cut these loses,” he said.
“As a group, we condemn the practice. People that previously condemned BDCs are now conniving with banks in ripping off the economy pretending that everything is fine. They should be called to order. As a licensed BDC, I should be allowed to sell dollars to my customers provided I provide genuine documentation. Banks that are supposed to advocate transparency are the ones violating the rules of the game,” he said.
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