Diaspora Remittances: ABCON Begs CBN To De-risk BDCs
- Says about N1trn annual transaction volume under threat
BY CHINYERE OBIORA – Troubled by daily job loss among its members, the Association of Bureaux De Change Operators of Nigeria (ABCON) has pleaded with the Central Bank of Nigeria (CBN) to de-risk BDCs operations to enable them to access foreign remittances in 2022 and beyond.
Speaking through their President, Alhaji (Dr) Aminu Gwadabe, ABCON lamented that the BDC sector has fast deteriorated and now becoming comatose since the Monetary Policy Committee (MPC) meeting of July 2021 where the CBN officially suspended weekly dollar interventions to the BDCs.
He said ABCON, as an umbrella body to over 5,3000 CBN-licenced Bureaux De Change (BDC) operators in the country, is worried about current developments given that over N1 trillion annual transaction volume in the BDCs sector is under threat.
In a statement to drive home their points, the ABCON President also noted that huge capital investment in the sector is not only becoming redundant but gradually being eroded and winding up in the process.
According to him, aside from the BDCs being licensed to offer retail forex sales across the counter forex transactions, they also contribute to Nigeria’s economic development by promoting order and confidence in the forex market; providing data for monetary policy; channels for CBN intervention in the Retail FOREX market; and creating over 15,000 jobs in the financial sector, among others.
Gwadabe said in the same manner that CBN is de-risking the nation’s agricultural sector and making it easier for agriculturalists to access cheaper loans at single-digit from banks, it can also consider de-risking the BDCs operations to receive diaspora remittances through the International Money Supply Operators (IMTOs) and deepen foreign capital flows to the economy.
He said ABCON fully appreciates the challenges faced by CBN as a result of dwindling foreign reserves; declining oil output and oil theft; fiscal policy challenges; debt burden; election spending; and COVID-19 induced economic pains that now make things difficult for the apex bank to sustain weekly dollar interventions to BDCs.
However, the ABCON chief said things would change for the better if the BDCs are allowed to access dollars or diaspora remittances through the autonomous forex windows with operators receiving IMTOs proceeds; carrying out online dollar operations; and Point of Sale (PoS) Agency, among other interventions.
For him, ABCON has developed multiple applications for BDCs’ transformation from being CBN cash dispensers to globally competitive entities with the capacity to attract foreign capital flows to the economy, adding; “We support any measures that would lead to compliance with the Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT), supporting CBN’s exchange rate stability policies and security agencies to punish any BDC operator breaching corporate governance and compliance guidelines.”
“It is our sincere belief that the BDCs need to be officially re-integrated to ensure their continuous potent role in exchange rate stability management”, Gwadabe said, adding that ABCON has been training Compliance Officers to ensure they are acquainted with what is required of them, especially on the monthly rendition of results and tracking illicit capital flows in the financial system
Maintaining that the Association has, over the years established itself as a key player in the BDC sector, Gwadabe said the members have also made several sacrifices and commitments in ensuring the sector continues to thrive in the face of mounting challenges.
He further said; “The recognition of the role of BDCs in Nigeria financial sector remains the first step to building a sustainable and viable forex market that is comparable to what is obtainable in other developed economies.”
However, the ABCON boss insisted that “Getting the Nigerian BDC sector to where it is desired to demand hard work, quality leadership, regulatory foresight, and sound government policies.”
