CBN’s forex ban, ploy to promote Travelex, BDCs allege

The Association of Bureaux De Change Operators of Nigeria (ABCON) has alleged that the decision of the Central Bank of Nigeria (CBN) to end direct sales of forex to the Bureaux De Change (BDCs) operators is a ploy to favour Travellex.

Aminu Gwadabe, President of the Association who stated this, argued that the forex market has been experiencing a lull in activities since the forex restrictions and the new policy, which he maintained, would help worsen the already precarious situation.

It would be recalled that the CBN had on Monday, suspended weekly dollar sales to BDCs to conserve the foreign reserves and protect the local currency. It was also meant to enable the apex bank to meet forex demand by domestic importers.

But Gwadabe claimed that CBN may have taken the decision to favour Travellex to the detriment of local BDCs.

Travelex is the world’s largest foreign exchange bureau specialized in international payments, bureaux de change and issuing prepaid credit cards for use by travelers. In 2000, it bought Thomas Cook’s worldwide forex business for 440 million Pounds Sterling, which significantly expanded its international operations.

“We’re pained that the CBN didn’t carry us along before taking the latest steps it took. This policy is like a death sentence for us,” he said.

Travelex has in recent months been opening retail shops across major locations in Nigeria like Airports, and highbrow areas to enable it meet the rising forex demand, and fill the vacuum created by CBN’s stoppage of dollar sales to BDCs.

According to Gwadabe, although licensed as a wholesale supplier and forex importer into Nigeria, the intention of Travelex is to take over the retail segment of the forex market, where BDCs operate.

Speaking further, he recalled that in 2001, the then CBN governor, Joseph Sanusi had allowed BDCs sell Travelers Cheques just as Travelex received the permission of the CBN to open desks in the branches of some banks, to sell Travelers Cheques to the public.

Read also: Dollar climbs to N295 in black market

But Travelex, he said, “allegedly made it difficult for BDCs to access Travelers Cheques to sell to the public as intended by the CBN,” adding that the apex bank’s decision at that time failed to bridge the widening gap between the official and parallel market exchange rates.

Gwadabe claimed the long-term plan of the CBN is to replace BDCs with Travelex outlets, which will begin operation soon.

“You know Travelex is a registered BDC operator in Nigeria, and is involved in the retailing of forex. They are both importer and distributor of dollars in the country. This function of distributing the dollars from the CBN to BDCs is outsourced to Travelex by the CBN for over three years now,” he said.
However in a chat with Ripples, the CBN Spokesman, Ibrahim Mu’azu dispelled insinuations that Travelex will take the place of BDCs.
He was quick to admit that the ban will ultimately create more room for Travelex to control the retail market space.
“Travelex has been in the market for a long time, and will do more retail than before, going forward,” he said.
……In from Ali Smart

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