Since its inception in 2005, the foreign exchange market for bureau de change (BDC) in Nigeria has witnessed significant expansion. Between the years 2005 and 2006, the number of functioning BDCs was below 100, with the Central Bank of Nigeria (CBN) providing US dollars to these entities.
In 2009, Charles Soludo, the ex-chief of CBN, along with the financial sector monitoring group (FSSC), conducted a thorough evaluation of the BDC sector’s functioning and expressed profound dissatisfaction with its performance.
“Recall that in 2006, the CBN initiated the direct sale of cash to BDCs as a component of the liberalization agenda to guarantee sufficient provision to this segment, thereby aiming for a parity between BDC and inter-bank exchange rates,” the past governor remarked.
“At the initiation of sales to BDCs in 2006, the operational BDCs in Nigeria numbered below 100, with weekly transactions not exceeding $30 million. Consequently, the exchange rates of BDCs plummeted, aligning with the official rate.
“Presently, the count of active BDCs is approximately 1,147 (with the CBN selling about $200 million weekly to them), yet the exchange rates of BDCs continue to diverge from the official rate.”
From the year Soludo voiced these observations, 2009, to 2021, the quantity of market participants surged to an estimated 5,500 — with weekly transactions nearing $110 million.
As of now, the tally of BDCs is 5,690, as per the CBN records. An examination of the entire list reveals several entities with notably unique names such as:
– CCTV BDC LTD
– Chelsea BDC LTD
– Couple BDC LTD
– Cream BDC LTD
– Cruising BDC LTD
– Day-by-day BDC LTD
– Deadlist BDC LTD
– Decorum BDC LTD
– Deep Freezer BDC LTD
– Divine Focus BDC LTD
– Ephesians-three-twenty BDC LTD
– Four to five BDC LTD
– Fourteen February BDC LTD
– Fullmoon BDC LTD
– Go-well BDC LTD
– Gucci BDC LTD
– Happy Ends LTD
– His Grace BDC LTD
– Home Alone BDC LTD
– Honeymoon BDC LTD
– Hourglass BDC LTD
– In-to-in BDC LTD
– JJC BDC LTD
– Looking and Seeing BDC LTD
– Lovers BDC LTD
– Pros and Cons BDC LTD
– Rice and Beans BDC LTD
– Select and Pay BDC LTD
– Set up BDC LTD
– SIX Six Six BDC LTD
– Slow Down BDC LTD
– You and Me BDC LTD
– Young Free & Single BDC LTD
– Zero to Ten BDC LTD
– 10-20 Times BDC LTD