11/07/2025
A PRESS STATEMENT BY CHAIRMAN OF THE AREWA ECONOMIC FORUM (AEF), IBRAHIM SHEHU DANDAKATA ON THE CBN’S NEW BDC RECAPITALISATION POLICY
Ladies and Gentlemen of the Press, Good morning.
On behalf of the Arewa Economic Forum (AEF), a coalition of Northern business leaders, intellectuals, technocrats, and grassroots stakeholders, I welcome you all to this critical press conference on a matter that strikes at the very heart of Northern Nigeria’s economic lifeline—the Central Bank of Nigeria’s (CBN) new Regulatory and Supervisory Guidelines for Bureau De Change (BDC) operations.
We acknowledge and appreciate the objectives behind the new CBN policy—to strengthen financial integrity, align BDC operations with global standards, and reduce market abuse. These are laudable goals in theory. However, in practice, the policy—particularly the recapitalisation requirement—poses a direct threat to thousands of legitimate Northern entrepreneurs and their families.
Certainly. Here is a polished and professional version of the updated section, preserving the core concerns while improving clarity, structure, and tone:
Before the introduction of the new recapitalisation guidelines in May 2024, the minimum capital requirement for obtaining a Bureau De Change (BDC) licence in Nigeria stood at ₦35 million under the previous regulatory framework.
However, under the new directives of the Central Bank of Nigeria the capital threshold has been drastically raised:
• Tier 1 BDCs are now required to have a minimum capital base of ₦2 billion. They are authorised to operate nationally, establish multiple branches, and appoint franchisees with prior approval.
• Tier 2 BDCs must now possess ₦500 million in capital and are limited to operations within a single state, with a maximum of five branches. They are not permitted to appoint franchisees.
This represents an astronomical increase of over 1,300% to 5,600%, depending on the tier—a burden that is clearly unattainable for many sincere and long-standing BDC operators, especially those who have conducted their business transparently and by the law.
It is particularly concerning that such a policy shift is occurring during a period when the government is publicly committed to anti-corruption and financial transparency, while also barring banks, NGOs, public officers, foreign nationals, and other financial institutions from owning BDCs. These restrictions leave genuine small-scale operators with limited pathways for growth or survival.
We must place on record that out of the over 1,600 registered BDCs in Nigeria, more than 90% of those able to meet the new capital requirements are based in the South—with Lagos alone accounting for the overwhelming majority, and the sector now being dominated by a single ethnic group.
In stark contrast, less than 10% of compliant BDCs are owned by Northerners, despite the fact that Northern traders have historically driven and sustained this sub-sector. This includes operators in long-established hubs such as Wapa in Kano, Zone 4 in Abuja, Broad Street in Lagos, and major market areas in Sokoto, Minna, Benin, and Port Harcourt.
Meanwhile, in comparable economies across Africa and beyond, the capital requirements for BDC operations are significantly lower than what is now being proposed in Nigeria. Our investigations reveal that countries such as South Africa, Kenya, Tanzania, Ghana, Egypt, the United Arab Emirates (UAE), and even India maintain substantially more accessible and affordable licensing thresholds, enabling broader participation and fostering financial inclusion without compromising regulatory oversight.
The implication is clear: if left unaddressed, this policy will wipe out the entire Northern participation in the BDC space, a sector that has been pivotal to job creation, forex accessibility, and informal financial services in the region for decades.
We cannot overlook the dangerous security implications of this development. Northern Nigeria is already reeling from the devastating effects of terrorism, rural banditry, and youth unemployment. Throwing thousands of BDC operators out of work will only add fuel to a volatile fire.
We call on President Bola Ahmed Tinubu and his key advisers to give these concerns the serious and urgent attention they deserve. This is not merely an economic policy matter—it is a pressing national security issue.
We particularly urge the National Security Adviser, Malam Nuhu Ribadu, to assess the broader implications of this policy and act swiftly to prevent the socio-economic fallout that could result from the mass displacement of legitimate BDC operators, especially in Northern Nigeria. As someone deeply attuned to the region’s fragile security dynamics, we believe it is well within his mandate to ensure that economic exclusion does not compound existing threats to peace and stability.
On Equity and Representation, we also call on the Honourable Minister of Finance, Mr. Wale Edun and the Governor of the Central Bank of Nigeria, Mr. Yemi Cardoso, to consider the optics and implications of a policy that many in the North may interpret as systematically exclusionary, particularly because nearly all major financial regulatory institutions—FIRS, SEC, CBN, PENCOM, NSITF and others—are currently dominated by appointees from the South, mostly of Yoruba extraction.
This is not a call for division; it is a firm plea for equity, fairness, and inclusive economic governance. At the inception of this administration, the AEF had expressed concern over the perceived trend of ‘Yorubanisation’ and ‘Lagos-centric’ concentration of key appointments in Nigeria’s economic institutions. While we recognise the President’s prerogative to appoint trusted individuals, we believe that national unity and balanced development are best achieved when all regions feel fairly represented and meaningfully included in strategic economic decision-making.
Our Recommendations:
1. Grant a Policy Extension
We strongly recommend extending the implementation window to be a continuous exercise like the process of other financial institutions, or a minimum of six (6) months or ideally one year (12) months, to allow for investor sensitisation, capital mobilisation, and regional collaboration. A rushed implementation will create irreversible damage.
2. Create Regional Investment Vehicles
We propose the creation of at least three (3) Tier 1 Northern-led BDC consortia to cater to regional operators. Regional investment vehicles must be established to pool resources and support smaller BDC operators.
3. Promote Inclusive Guidelines and Incentives
CBN must consider friendly, gradual, and inclusive regulatory frameworks, especially for regions where formal capital is scarce but informal finance thrives. This is how real development works—through inclusion, not exclusion.
4. Encourage Transparency in ABCON Negotiations
We urge Alhaji Aminu Gwadabe, President of the Association of Bureau de Change Operators of Nigeria (ABCON), to demonstrate courage, firmness, and transparency in all ongoing engagements with policymakers on this highly sensitive issue. As a respected leader in the sector, he bears the responsibility of ensuring that any negotiated outcomes reflect the interests of all stakeholders—not just established elites, but also the grassroots operators, particularly those from the North who have historically built and sustained the BDC sub-sector over decades. This is a defining moment that calls for principled leadership and a commitment to equity within the industry.
If handled correctly, the recapitalisation drive can formalise and strengthen BDC operations. But if mishandled, it may: destroy thousands of legitimate Northern businesses, deepen regional poverty, worsen youth unemployment, heighten insecurity and erode public trust in national institutions.
We therefore urge Northern investors, political leaders, and business communities to rise to the challenge. Let us invest in our own, collaborate across states, and protect this vital industry.
The BDC sector has, for decades, ensured financial access in rural and underserved areas, created thousands of jobs, offered flexible foreign exchange solutions, and helped many families survive harsh economic times.
We must not allow that legacy to be erased in one policy stroke.
In conclusion, we at the Arewa Economic Forum believe in a united, equitable, and prosperous Nigeria. We believe in policies that lift all regions, not just a few. This moment calls for national reflection and compassionate reform.
Let us work together to build an economy that includes—not excludes—the hardworking people of Northern Nigeria. Thank you.
God bless us and bless the Federal Republic of Nigeria.
Alhaji Ibrahim Shehu Dandakata
Chairman, Arewa Economic Forum (AEF)
