The Central Bank of Nigeria (CBN) is considering increasing the share capital of Bureau De Change (BDC) operators to N2 billion and N500 million for Tier 1 and Tier 2 licences, respectively.
Previously, a generic licence cost N35 million. This was stated in the draft REVISED REGULATORY AND SUPERVISORY GUIDELINES FOR BUREAU DE CHANGE OPERATIONS IN NIGERIA issued by the apex bank.
The new standards make various revisions to the guidelines for BDC operations in the country. If approved, the new guidelines will become effective on a date determined by the CBN.
Minimum Capital: Under the minimum capital requirements, the central bank is introducing a two-tier license for BDC operators in the country.
“A Tier 1 BDC is authorized to operate on a national basis can open branches and may appoint franchisees, subject to the approval of the CBN.
A Tier 1 BDC (which is the franchisor) shall exercise supervisory oversight over its franchisees. All franchisees shall adopt their franchisor’s name, branding, technology platform, and rendition requirements.
A Tier 2 BDC is authorized to operate only in one state or the FCT. It may have up to three locations – a head office and two branches, subject to approval of the CBN. It is not permitted to appoint franchisees.”
- Under Tier 1 operators are expected to have N2 billion as minimum share capital while also depositing a Mandatory Caution Deposit of N200 million.
- The application and license fee is also N1 million and N5 million respectively.
- Under Tier 2 operators are expected to have N500 million as minimum share capital while depositing a Mandatory Caution Deposit of N50 million.
- The application and license fee are also N250,000 and N2 million respectively.
- The apex bank also stated that the prescribed minimum capital of BDCs and any subsequent capital injection shall be subject to verification by the CBN.