CBN Moves to Place Annual Limit on Foreign School Fees, Medical Bills Payments from BDCs
- The Central Bank of Nigeria has introduced strict measures for annual school and medical fee payments for BDCs
- The bank places an annual $10,000 limit for school fees and $5,000 for medical bill payments with comprehensive documentation.
- The apex bank says the measures are part of plans to streamline the activities of the BDCs in Nigeria and strengthen the naira
Legit.ng’s Pascal Oparada has reported Tech, Energy, Stocks, Investment and the Economy for over a decade.
The Central Bank of Nigeria (CBN) is reportedly planning to introduce strict measures on purchasing foreign currencies via Bureau de Change (BDC) operators in Nigeria regarding transactions on overseas medical and educational expenses.
The apex bank said this is part of its revised regulatory guidelines BDC operators issued on Friday, February 23, 2024.
Source: UGC
Guidelines for foreign school fees payment
The guideline states that there will be a limit on foreign currency purchases for school fees at $10,000 per customer annually.
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The bank stated that the process requires transactions with Nigerian banks via the BDC’s domiciliary accounts to ensure direct payment to the educational institution.
CBN said:
“BDCs may sell foreign currency up to USD10,000 to a customer for school fees once a year. Such fee shall be transferred from the BDC’s domiciliary account with a Nigerian bank and paid directly to the school.”
Reports say the guidelines also state that such transactions must be done by documents such as e-Form A, proof of admission or course registration, educational institution’s bill or invoice, and, for post-graduate studies, a copy of the undergraduate degree certificate or an official signed statement of results.
In the guidelines, the CBN also placed a limit of N5000 per annum for foreign currency transactions for medical bills abroad.
Guideline for medical bills abroad
Also, funds for medical bills will be transferred directly from BDC’s domiciliary account to the medical facility and supported by exhaustive documentation.
The guidelines for medical bills include:
- E-Form A.
- A referral letter from a recognised specialist doctor or hospital in Nigeria.
- Valid travel documents.
- A letter from an overseas medical professional showing the cost of treatment.
Analysts believe that the new move by the CBN is meant to strengthen the naira’s performance against the US dollar.
The report follows the naira crash in the official foreign exchange market on Friday, February 23, 2024.
The naira traded at N1,550.50 per dollar on the official Nigerian Autonomous Foreign Exchange Market (NAFEM), a Legit.ng report said.
CBN imposes new capital requirements on BDCs
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The development comes as the Central Bank of Nigeria (CBN) proposed new regulations to increase Nigeria’s minimum requirements for Bureau de Change (BDC) operators to N2 billion and N500 million for Tier 1 and Tier 2 licences.
The latest development changes from the previous requirement of N35 million for a general license.
The new directive is in an Exposure draft in Nigeria's Revised Regulatory Supervisory Guidelines for Bureau De Change operations.
CBN readjusts exchange rate for cargo clearance
Legit.ng had reported that the Central Bank of Nigeria (CBN) had increased the exchange rate for customs clearance at Nigeria ports from N1,537.07 to N1,605.82 per dollar, an increase of N68.75, showing an adjustment to market conditions.
The recent adjustment is the third time in a week that the apex bank will adjust the exchange rate due to the naira's volatility, as shown by the federal government's trade portal, ensuring accurate valuation amid market dynamics.
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Source: Legit.ng
