New CBN’s BDC policy threat to northern economy, national security – Arewa Forum

The Arewa Economic Forum (AEF) has alleged that cautioned that the new the Central Bank of Nigeria’s (CBN) Bureau De Change (BDC) recapitalisation policy could potentially shut out thousands of legitimate Northern operators who have sustained the sub-sector for decades.

AEF said this at a press conference addressed by its Chairma, Alhaji Ibrahim Shehu Dandakata on Tuesday in Abuja.

The minimum capital to operate a BDC was N35 million under the old regulatory structure.

But under the new rules, Tier One BDCs must now have N2 billion in capital and may operate nationally with branches and franchise.

Tier Two BDCs need N500 million, limited to one state and five branches, with no franchise options allowed.

This represents a rise of over 1,300 per cent to 5,600 per cent —a near-impossible burden for most long-standing and law-abiding BDC, according to the think-tank.

It described the BDC recapitalisation policy as economically exclusionary, regionally lopsided, and a looming threat to national security.

“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 recapitalisation requirement poses a direct threat to thousands of legitimate Northern entrepreneurs and their families,” Dandakata stated.

Dandakata described the capital hike as astronomical—an increase of over 1,300% to 5,600%—and warned that this level of financial demand is unattainable for most honest and longstanding BDC operators.

He added that the timing of the policy was especially troubling, given the government’s anti-corruption stance and the exclusion of banks, NGOs, public officers, foreign nationals, and other financial institutions from BDC ownership, which further limits financing options.

The AEF noted that more than 90% of BDCs that have met the new requirements are based in the South, with Lagos alone accounting for the vast majority, and the sector now dominated by a single ethnic group. In contrast, less than 10% of compliant BDCs are owned by Northerners, despite Northern traders historically sustaining the sub-sector, particularly in commercial hubs such as Wapa in Kano, Zone 4 in Abuja, Broad Street in Lagos, and markets in Sokoto, Minna, Benin, and Port Harcourt.

Dandakata added that in several comparable countries—including South Africa, Kenya, Tanzania, Ghana, Egypt, the UAE, and India—the capital requirements for BDC operations remain far lower and more inclusive, enabling broader participation without compromising regulatory integrity.

According to him, Nigeria’s new policy could wipe out Northern participation in the BDC space, a sector that has long contributed to job creation, foreign exchange accessibility, and informal financial services across the region.

He warned of the potential security fallout. “Northern Nigeria is already battling terrorism, banditry, and rampant youth unemployment. Rendering thousands of BDC operators jobless will only worsen the crisis,” he said.

He urged President Bola Ahmed Tinubu and his advisers to urgently address the policy’s implications, adding that this is not just an economic policy issue but a matter of national security.

He specifically called on the National Security Adviser, Malam Nuhu Ribadu, to act swiftly in assessing the broader socio-economic dangers and preventing mass displacement of Northern entrepreneurs. He also appealed to Finance Minister Wale Edun and CBN Governor Yemi Cardoso to reconsider the policy’s optics and regional imbalance, especially given that most top appointments in Nigeria’s financial institutions—including FIRS, SEC, PENCOM, and NSITF—are held by Southerners, predominantly of Yoruba origin.

“This is not a call for division; it is a firm plea for equity, fairness, and inclusive economic governance,” Dandakata stressed.

In light of these concerns, the AEF proposed that the policy implementation timeline be extended to a minimum of six months, or ideally made continuous, to allow adequate time for investor sensitisation, capital mobilisation, and regional participation. It also called for the establishment of at least three Tier 1 Northern-led BDC consortia to pool resources and support operators, and for a regulatory approach that is more flexible and inclusive, especially in capital-scarce regions.

The AEF urged Alhaji Aminu Gwadabe, President of the Association of Bureau de Change Operators of Nigeria (ABUCON), to show courage, transparency, and commitment in his engagement with policymakers. Dandakata said outcomes from these dialogues must reflect the interests of all stakeholders—not only elite operators but also the grassroots players, particularly in the North.
He concluded with a call to action for Northern investors, leaders, and business communities to invest in the sector and collaborate in safeguarding its future.

According to him, the BDC industry has played a crucial role in extending financial access, creating jobs, and supporting informal economies in underserved areas. “We must not allow this legacy to be erased in one policy stroke,” he said.

The Arewa Economic Forum reaffirmed its commitment to a united, inclusive, and prosperous Nigeria. “Let us work together to build an economy that includes—not excludes—the hardworking people of Northern Nigeria,” Dandakata said.