The Association of Bureaux De Change Operators of Nigeria (ABCON), has said over 6000 if its members nationwide contributed one trillion naira annually to the nation’s economy.
Alhaji Aminu Gwadabe, President, ABCON, said in a keynote address at the association’s virtual Annual General Meeting in Lagos where reports where they discussed “BDCs Operations: A Trillion Naira Sub Sector, Issues of Formalisation Regulations & Way Forward”.
The special AGM was organised against the backdrop of challenges being faced by the BDC sub sector and also to reposition it as a critical sector in the nation’s foreign exchange market.
“As a key player in the BDC industry, ABCON has for decades made several commitments to ensure that the sector continues to thrive against all odds.
“We are happy to announce that the licenced BDCs sub sector is commanding N1 trillion annual turnover in the economy,” Gwadabe said.
He added that the Central Bank of Nigeria (CBN) had the largest contribution of foreign exchange traded by BDCs through its weekly interventions.
“The BDCs also access dollars from other autonomous sources such as Diaspora Remittances, walk-in customers and bank sources,” Gwadabe said.
The ABCON chief noted that one of the other critical mandate of the BDCs, as required by the CBN, was exchange rate stability and boosting market liquidity.
According to him, BDCs have ensured that the market gained the needed liquidity that enabled the exchange rate to remain stable and chase illegal operators out of business.
On regulations, Gwadabe said that BDCs were required to comply with all extant rules & regulations prescribed by the Bank, while the CBN closely supervises and monitors their operations.
He said the CBN continued to publish the list of all the Licenced BDCs and their registered places of business periodically, for the information and benefit of members of the public.
“In compliance with the provisions of Bank’s and Other Financial Instructions (BOFIA) Act 2020 as amended, every BDC renders returns to the CBN in prescribed format and within the deadline stipulated by the CBN.
“The records of the BDCs are made readily available to the CBN examiners as and when requested, including carrying out customer due diligence, corporate governance and tax returns.
“Where a BDC fails to provide the required records, appropriate sanctions shall be imposed.
“Every Director of BDC signs and executes the Code of Conduct and ensure strict adherence to the code,” Gwadabe said.
On their challenges, Gwadabe said that BDC operations were frustrated by low level formalisation, poor compliance to regulation and complex documentation requirements.
He cited other challenges to include inhibitive regulatory policies, lower margins, poor public perception and generalization of criminalization of BDCs.
Gwadabe said that ABCON had digitized BDCs operations with the official launch and take-off of the ABCON Live Run Automation Portal in Lagos.
He said the project, which had the backing of the CBN, ended decades of manual filling of regulatory reports by BDCs and enhanced the global competitiveness of operators.
“We believe that the full digitization of BDCs operations is a boost for financial system stability and the economy, ahead of the Financial Action Task Force (FATF) assessment for Nigeria this year.
“The portal, which is a game changer in the Nigerian BDC Industry, is the final phase of automating all BDCs’ operations and integrating them with the operations of CBN, NFIU and Nigeria Inter-Bank Settlement System (NIBSS), for improved compliance with regulation and seamless operations, ” Gwadabe said.
He urged the CBN to include BDCs as pay agents of Diaspora remittances
Gwadabe explained that ABCON was working with its consultants to revamp the naijabdcs.com to MyBdc.com to make the site transactionary, informative and to finally nip abokifx.com in the bud.
To engender greater stability in the exchange rate, Gwadabe called for increased checks and control along the borders, to forestall unlawful evacuations of FX to UAE, China and Lebanon.
He called for the bridging of the gap between the fixed exchange and flexible rates to check speculation.
Also, the BDCs sub-sector has generated over 20,000 employment for Nigerians and will continue to promote exchange rate stability, education on fake currencies and boosting market liquidity.
Gwadabe said that ABCON had continued to partner relevant regulatory agencies in the training and retraining of it’s members, in conformity with global best practice.
He noted that the one of the primary objectives of the trainings was to ensure that BDCs were not used to launder funds for politically exposed persons during elections.
He called on the CBN to approve the ABCON Training Institute, so as to ensure that all it’s members benefitted from the training.