A coalition of northern business operators under the aegis of Arewa Economic Forum (AEF) has warned that the new Bureau de Change (BDCs) recapitalisation will throw many families in the north into deeper poverty and exacerbate hunger in the region.

The chairman of the group, Ibrahim Dandakata, who stated this yesterday in Abuja, said the group was not oblivious of the advantages of the recapitalisation.

He said: “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 poses a direct threat to thousands of legitimate Northern entrepreneurs and their families.”

Before the introduction of the new recapitalisation guidelines in May 2024, the minimum capital requirement for obtaining a BDC licence stood at N35 million.

However, under the new directives of the Central Bank of Nigeria (CBN), the capital threshold has been drastically raised as Tier-1 BDCs are now required to have a minimum capital base of N2 billion.

They are also authorised to operate nationally, establish multiple branches and appoint franchisees with prior approval.

Tier-2 BDCs must now possess N500 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.

The group noted that such a policy shift is occurring at a period when the government is committed to anti-corruption and financial transparency, while also barring banks, NGOs, public officers, foreign nationals and other financial institutions from owning BDCs.

It added that the 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 per cent 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 per cent of compliant BDCs are owned by northerners, even though northern traders have historically driven and sustained the sub-sector.

“This includes operators in long-established hubs such as Wapa in Kano, Zone Four in Abuja, Broad Street in Lagos and major market areas in Sokoto, Minna, Benin and Port Harcourt,” the group explained.

It also insisted that in comparable economies across Africa and beyond, the capital requirements for BDC operations are significantly lower than what is now being proposed in Nigeria.

It added that countries such as South Africa, Kenya, Tanzania, Ghana, Egypt, the United Arab Emirates (UAE) and India maintain more accessible and affordable licensing thresholds, enabling broader participation and fostering financial inclusion without compromising regulatory oversight.

AEF said if the CBN goes ahead with the implementation of the new requirements, the policy would 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.