The Central Bank of Nigeria (CBN) has announced the upcoming launch of the Nigerian Foreign Exchange (FX) Code, which is set to take effect on January 28, 2025. The newly introduced code aims to establish ethical standards for authorized dealers operating within the Nigerian foreign exchange market.
In an official statement posted on its website, the CBN confirmed that the formal unveiling of the FX Code will take place at its headquarters in Abuja on Tuesday, January 28, 2025.
This initiative is part of ongoing efforts to enhance governance and promote transparency within Nigeria’s FX market. As part of these reforms, the CBN had earlier, in November 2024, rolled out revised guidelines for the Nigerian Foreign Exchange Market (NFEM).
A notable requirement under the updated guidelines is that bank boards, Chief Executive Officers (CEOs), and Chief Compliance Officers must annually affirm their adherence to the FX Code of Ethics and Conduct. This measure is intended to reinforce their dedication to upholding market integrity and full compliance with regulatory directives issued by the apex bank.
Key Features of the Revised Guidelines
The new framework is designed to foster a more efficient and accountable FX market, following the merger of all official FX market windows. According to a circular signed by Omolara Omotunde Duke, director of the CBN’s financial markets department, these new directives replace previous guidelines, including changes announced in June 2023 and earlier policies dating back to 2017.
Under the revised rules, authorized dealers are required to facilitate foreign exchange transactions for both individuals and businesses while ensuring strict compliance with regulatory requirements. They must also maintain transparency in pricing and provide access to FX services through digital platforms. The CBN has emphasized that all legitimate FX transactions must be conducted exclusively through licensed dealers, and interactions with unauthorized intermediaries are strictly prohibited.
Implications for Bureau de Change Operators
The updated guidelines extend to Bureau de Change (BDC) operators as well. Licensed BDCs can procure FX from authorized dealers to meet customer demands within the limits defined by the CBN. In addition, transactions carried out by BDCs, International Money Transfer Operators (IMTOs), and authorized dealers must comply with their licensing terms and the provisions outlined in the FX Code.
By implementing these measures, the CBN aims to create a more transparent and well-regulated foreign exchange environment, fostering confidence among stakeholders and ensuring a level playing field for all participants in the FX market.
