Nigeria’s naira is poised for a potential strengthening following a move by the Central Bank of Nigeria (CBN) allowing licensed Bureau de Change (BDC) operators to purchase up to US$150,000 weekly. Announced in a circular on February 11, 2026, the policy aims to improve foreign exchange liquidity in the retail segment and meet the legitimate dollar needs of end users, officials said.
The circular, signed by Dr. Musa Nakorji, Director of the Trade and Exchange Department, directs authorised dealer banks and BDC operators to comply with the new limit while observing strict reporting and transparency requirements. The apex bank emphasized that all licensed BDCs must submit timely and accurate electronic returns, sell back any unutilized balances within 24 hours, and restrict cash settlements to a maximum of 25 percent of any transaction. Third-party transactions are prohibited, and all settlements must be conducted through accounts held with licensed financial institutions.
Analysts say the move is likely to narrow the gap between Nigeria’s official and parallel market rates, which has been a longstanding concern for policymakers. Ayotunde Olubunmi, Head of Financial Institutions at Agusto & Co., described the development as part of broader CBN efforts to address distortions in the forex market. He noted that improving liquidity in the BDC segment is expected to reduce speculative pressure and arbitrage opportunities, fostering a more unified and stable exchange rate framework.
“By expanding access to foreign currency through licensed BDCs, the central bank is likely to moderate the spread between official and parallel market rates,” Olubunmi said. “This should promote stability and encourage more businesses to transact through formal channels.”
Market participants have welcomed the development, predicting that a firmer naira could benefit companies with significant foreign currency-denominated costs, particularly in consumer goods, industrial production, and import-dependent sectors. Tunde Amolegbe, CEO of Arthur Stevens Asset Management, explained that a stronger domestic currency would reduce cost burdens on manufacturers and importers, especially for raw materials and machinery sourced in dollars.
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“Expect further strengthening of the naira against the US dollar,” Amolegbe said. “This will be positive for companies operating in sectors where foreign inputs dominate, ultimately supporting production efficiency and profitability.”
Similarly, Tilewa Adebajo, CEO of CFG Advisory, highlighted the importance of widening distribution channels for foreign exchange. “Availability of forex through more channels is helping with rate stabilisation,” he said, emphasizing that access via BDCs complements the CBN’s broader strategy to improve transparency and mitigate market distortions.
The new framework also places operational discipline at the forefront, with BDCs required to return unutilized balances promptly and execute transactions through authorised channels. This ensures compliance with the apex bank’s rules and reinforces efforts to formalize forex dealings across the country.
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The policy is part of the CBN’s broader measures to stabilise the naira and support investor confidence amid ongoing economic challenges, including inflationary pressures and currency volatility. By empowering BDC operators with higher purchase limits and enforcing reporting standards, the central bank aims to strengthen the naira’s stability, reduce the reliance on parallel markets, and promote orderly forex distribution.
While the effectiveness of the new limit will depend on consistent enforcement and market compliance, analysts say the move is likely to enhance liquidity, narrow exchange rate gaps, and provide relief to businesses and consumers seeking access to dollars for essential imports.
With the CBN’s renewed focus on transparent operations and broader access, Nigeria’s retail forex market may witness improved efficiency and reduced speculative activity. For companies operating with heavy foreign currency exposure and the wider economy, the new policy is a step toward a more stable exchange rate environment and enhanced macroeconomic resilience.
