By Charles Pemu 
The Central Bank of Nigeria’s (CBN) decision to grant operating licences to 82 new Bureau De Change (BDC) operators has stirred significant concern across Abuja’s foreign exchange (FX) ecosystem. Operators and analysts warn that the move, while intended to liberalize the market, risks heightening instability and increasing saturation in the retail FX segment.
The approvals are part of the CBN’s ongoing effort to restructure and professionalize the FX market following years of volatility and the revocation of over 4,000 non-compliant BDC licences in 2024. The new regulatory framework includes a two-tier licensing structure with significantly raised minimum capital requirements: ₦2 billion for Tier-1 and ₦500 million for Tier-2 operators.
Fear of Market Saturation Amid Scarce Supply
In Abuja’s major trading hubs, the immediate reaction is one of caution. Operators fear that suddenly onboarding 82 new BDCs risks flooding the market without a corresponding increase in the supply of foreign currency.
An Abuja-based operator, speaking anonymously, noted that existing BDCs are already struggling with declining transaction volumes and tighter controls. He warned, “Bringing 82 more BDCs into the market when the dollar supply is this thin only increases the competition for the same scarce resources.”
FX analyst Chude Marvelous echoed this sentiment, referencing past eras where rapid and poorly monitored licensing led to speculative behaviour and rate volatility. He cautioned, “If supervision is not airtight, we could see unhealthy competition, excessive rate fragmentation, and behaviours that undermine pricing integrity in the retail FX market.”
Analysts Call for Phased Approach
Policy analyst Dr. Nathan Udo stressed that the CBN should have adopted a more gradual, sequenced approach to expansion, arguing that the FX market remains too vulnerable for such rapid growth in participation without first bolstering dollar inflows.
“The FX market is recovering from multiple shocks. Approvals of this scale should be sequenced, allowing the regulator to monitor liquidity conditions and operator behaviour before adding more players,” Udo advised. He insisted that reforms will only be effective if supported by stronger FX supply sources, particularly export proceeds, remittances, and foreign investment inflows.
The new licensees are now required to meet stringent compliance obligations, including higher capitalisation and real-time transaction reporting. Some BDC owners question how many of the newly licensed operators can operate sustainably under these tough conditions without resorting to “cutting corners.”