The Association of Bureau de Change Operators of Nigeria (ABCON) has urged the government as well as the Central Bank of Nigeria(CBN) to focus on reducing the number of Bureau de Change (BDC) operators in the country rather than increasing their capital requirement.
Speaking with LEADERSHIP yesterday, the president of ABCON, Aminu Gwadabe said, with nearly 6,000 BDCs operating in the country, there is need to consolidate as the current number could prove to be more than the CBN could accommodate.
Gwadabe, whilst referring to the proposed N1 billion capital requirement by the National Economic Council for BDCs, said increasing the capital requirement may not solve the issue of a bloated number of operators in the country.
According to him, there is need for consolidation in the industry to reduce the number of operators, as he added that a better capital requirement would be N250 million from the current N35 million capital base.
He noted that the industry needs more than recapitalisation, saying increasing the capital base without calling for consolidation and mergers would not achieve the aim of reducing the number of BDCs in the country.
The policy advisory council of President Bola Tinubu had asked the Federal Government to increase the capital requirements of BDCs operators that seek to participate in Nigeria’s foreign exchange market. The council said only BDCs with a strong capitalisation should be allowed to participate in the country’s forex market.
The CBN, in July 2023, updated the number of BDCs operating in the country, confirming 5,687 operating licenses. This was disclosed in a publication titled, ‘Approved BDCs’ on the CBN website. The number of BDC operators in Nigeria has risen by more than 75-fold in 18 years, from 74 in 2005 to 5,687 in 2023, data from the CBN revealed.