The Association of Bureau De Change Operators of Nigeria (ABCON) has commended the Central Bank of Nigeria (CBN) for its recent directive to cease the use of non-oil export domiciliary accounts for Naira loans.
Its president, Dr. Aminu Gwadabe, said in a statement on Thursday in Lagos that the stoppage would add to dollar liquidity in the market and also help in the accretion of the nation’s buffers.
Gwadabe expressed surprise that some companies and manufacturers with huge billions of dollars in their non-oil export domiciliary accounts sourced foreign exchange needs in the official window and used the same for Naira loans.
“We therefore advise the review of the guidelines on holding currencies on non-oil export accounts for a maximum of 48 hours to borrow from the South African policy on the operations of non-oil export domiciliary account proceeds.
“The CBN should also not make applicants of huge billions of dollars holding on their non-export oil proceeds Dom accounts eligible for fx requests at both the NAFEM and NAFEX window.
“In the same vein, we urge the CBN to upgrade its policies and circulars to legislation regarding the impending BDC’s new reforms.
“This is to give comfort and guarantees to would-be investors in the transformation of the BDC industry’s subsector, allowing only the existing stakeholders the grandfather’s right for mergers and acquisitions to meet the expected reviewed financial requirements as suggested by ABCON.
“We also want to pledge our continuing support for the CBN’s proactive and effective policies to address our volatility headwinds,” Gwadabe said.
He said that, being a self-regulatory body, ABCON and its members had resolved to continually engage all stakeholders and players in the retail end market.
The engagement, he noted, was to deepen, liberalise, democratize, and centralise the retail end segments of the market for price discovery, market efficiency, transparency, accretion of buffers, and a healthy balance of payments.
“We express our profound gratitude to the management of the CBN for its reconsideration and reinstatement of our subsector as the third leg of the market to counter hoarding and speculation with faster results than expected.
“The BDCs, though unfortunately perceived sometimes as crude but effective, will always remain the potent transmission mechanism tool for achieving the apex bank’s mandate of price stability and liquidity in the market.
“We therefore urge the CBN to continue to drive and expand its thought mechanism to maintain the feat so far achieved in more than 15 years, as we have not only achieved the convergence of both rates but also the also the market calmness and confidence of the public and foreign investors.
“We also call for the separation of the ownership and operational structure of FMDQ,” Gwadabe added. (NAN)
