CBN Targets Rate Convergence with Directive to Sell Remittances to BDCs – Thisday

By Obinna Chima   

The Central Bank of Nigeria (CBN) yesterday explained that its directive to banks that act as agents of international money transfer operators to commence the sale of foreign currency remittances to licensed Bureau De Change (BDC) operators was aimed at achieving exchange rate convergence.

The Special Adviser, Financial Markets to the CBN Governor, Mr. Emmanuel Ukeje, who said this in a phone interview with THISDAY, stressed that the move should not in any way be described as a policy sommersault, as seen by some commentators.

THISDAY reported at the weekend that the central bank had directed authorised dealers who are agents to approved international money transfer operators to sell foreign currency accruing from remittances to licensed BDCs as part of efforts to boost dollar liquidity in the market and ensure stability of the exchange rate.

In its circular, the central bank said: “The foreign currency proceeds of international money transfers sold to BDC operators shall be retailed to end-users in compliance with the provisions of Anti-money Laundering Laws and observance of appropriate Know-Your-Customer (KYC) principles, including the use of Bank Verification Numbers (BVNs).”