CBN’s new intervention boosts forex liquidity in Kano

The weekly sale of foreign currencies to Bureaux De Change (BDC) introduced by the management of the Central Bank of Nigeria (CBN) seems to have restored live to the operations of the foreign currency dealers in WAPA Market in Kano.
The new measure, which brought about increment in forex disbursement per BDC to $10,000 weekly, has boosted the liquidity of the commodity at the market.
Checks conducted by BusinessDay on Wednesday indicate that the increased disbursement of the commodity to the dealers has also increased their turnover margins.
Isaac Okorafor, acting director, communications, CBN, had recently announced the new measure that came into effect on April 3, pointing out that the measure was a continuation of the bank’s determination to sustain liquidity in the foreign exchange market.
Under the scheme, licensed BDC operators are required to fund their accounts with the CBN on Mondays and Wednesdays, while they receive their purchases on Tuesdays and Thursdays, respectively.
It was observed that the increase of the sale of forex to BDCs, which amount to $10,000 weekly ($5,000 per bid) had greatly grow liquidity at the market, as well as the profit margins of the dealers
Commenting on the new measure, Labaran Abdullahi Kura, CEO, LBNAKURA BDC Limited, said the initiative of the apex bank was worthy of commendation.
Kura noted that before the latest measure was introduced, activity at the foremost privately driven alternative currency market in northern Nigeria was characterised by low performance.
“I will like to let the government know that currency dealers in WAPA are very pleased with the latest efforts of the management of the CBN to increase forex allocation to BDC.
“Since the measure was introduced last week, it has impacted positively not only on the value of the Naira. The currency has continued to be on the rise, and business activity has also increased as there are more forex to sale to end users.
“Judging from what we are witnessing at the market I can confidently tell anyone that if this measure is sustained, in no distance period the value of the Naira will appreciate drastically,” he stated.
Speaking in the same, Isyaku Rawayau, a staff of Al-Amanat Nigeria Limited, one of the active BDC in the market, described the new measure as a welcome development.
“The increase in the amount of forex sale to BDC means that we now have more transactions. Buyers who need forex can now access it, unlike when the commodities are available.
“Although the margin between buying and selling are daily narrowing, we are happy because we are still able to get small thing after selling what we are offer by the CBN,” he said.