How to obtain a Foreign Exchange Dealer License in Nigeria (2025 CBN Guide)

If you want to legally buy and sell foreign currency to end users in Nigeria, the practical pathway is to obtain a Bureau de Change (BDC) license from the Central Bank of Nigeria (CBN)—and then, if you intend to participate as a “dealer” in the Nigerian Foreign Exchange Market (NFEM), also secure authorised dealership status from the CBN’s Trade & Exchange Department. Banks (“Authorised Dealer Banks”) hold this status by virtue of their banking license; for non-banks, the CBN’s BDC framework is the formal route into retail FX dealing.

Below you will find: the license types, minimum capital and fees, every document you must file, and the exact three-stage process CBN uses (Approval-in-Principle → Provisional Approval → Final License). We also cover how a BDC becomes an authorised dealer in the NFEM, ongoing operational rules (EFEMS, FX Code, TRMS, NIBSS/BVN), timelines, and FAQ/misconceptions.

What “Foreign Exchange Dealer” means in Nigeria—who licenses whom?

• Authorised Dealer Banks (ADBs): Deposit money banks licensed by CBN. They are default participants (“dealers”) in the interbank FX market and EFEMS. This is not a separate stand-alone “FX dealer license”; it is inherent in the bank license and related CBN market rules.

• Bureau de Change (BDC): A company licensed by CBN to carry on retail foreign-exchange business only (sell PTA/BTA, medical, school fees, etc.). BDCs can also apply to the CBN Trade & Exchange Department for an authorised dealership license to participate in the NFEM as a dealer—after obtaining the BDC license.

In short: if you are not a bank, the realistic route to becoming a “foreign exchange dealer” is to get a BDC license and then obtain authorised dealership status for NFEM participation.

License categories and what each one lets you do

CBN recognises two BDC tiers:

• Tier 1 BDC — Operates nationwide; may open branches and appoint franchisees (with CBN approval). Must ensure minimum distances between locations and oversee franchisees.

• Tier 2 BDC — Operates in one state (or the FCT) and may open up to five branches in that state (with CBN approval). No franchisees allowed.

Permissible activities include buying FX from permitted sources (tourists, diaspora returnees, domiciliary account holders, IMTOs, hotels authorised to buy FX, and—if licensed as a dealer—via the NFEM) and selling FX for PTA/BTA, school fees, medical bills, and certain professional fees, subject to documentation and TRMS processing. Non-permissible activities include street trading, taking deposits or granting loans, international outward transfers, derivatives/speculative trading, dealing in crypto, and more.

Minimum capital and statutory fees (CBN official figures)

CBN’s approved guidelines (effective June 3, 2024) set the following financial requirements for BDC licensing. Amounts below are exactly as specified by CBN. Central Bank of Nigeria

CBN notes these financial requirements may vary at the Bank’s discretion. All capital deposits are subject to verification by CBN. Fees must be paid via RTGS to a designated CBN account at the point the Bank instructs you.

Exactly how to obtain a Foreign Exchange (BDC) license: CBN’s three-stage process

CBN processes BDC applications in two main stages, but the final license stage itself has two sub-stages; practically, you will go through three checkpoints:

1. Approval-in-Principle (AIP) → 2) Provisional Approval → 3) Final License.

1) Approval-in-Principle (AIP)

• Address your application to the Governor, CBN.

• Do not incorporate the company at CAC until the CBN has issued an AIP in writing (you will take that AIP letter to CAC for registration).

• Your application must contain all items in Appendix 1 (see “Document checklist” below).

• CBN will scrutinise your objects (MEMART), fit-and-proper status of directors/senior management, source of capital (no cash funding; proper documentation), and reasonableness of your business plan/projections.

• If satisfied (including verification of capital contributions), CBN issues AIP. AIP is not permission to start business.

2) Provisional Approval (first part of final licensing)

• Deadline: Within 6 months after AIP, apply for Provisional Approval to the Director, Financial Policy & Regulation Department (FPRD), CBN, Abuja, attaching all items in Appendix 5 (see checklist).

• CBN conducts a pre-licensing inspection—reviewing physical & IT infrastructure, original documents, shareholder registers/certificates, security and insurance arrangements, and meeting the proposed board/management.

• If satisfactory, CBN grants Provisional Approval so you can complete system integrations and other readiness tasks.

3) Final License (second part)

• Within 60 days of Provisional Approval, apply for the Final License with all items in Appendix 6 (see checklist).

• Before final license, you must have completed critical IT integrations (CBN Extranet/returns systems; FIFX, FinA, CARP, TRMS, FIRS TIN Verification; and NIBSS–BVN connectivity) and obtained:

  • Operational Code from the Director, Trade & Exchange Department (TED), and

  • NFIU confirmation that you are set on its platform to render AML/CFT/CPF returns.

• After CBN’s approval decision, you will pay the non-refundable license fee via RTGS; CBN then issues the Final License.

The document checklists

Below are condensed versions of the official appendices. Use them to compile your file and avoid delays.

A) AIP checklist — Appendix 1 (before CAC incorporation)

• Letter of application for AIP.

• Evidence of valid name reservation at CAC.

• List of proposed shareholders with emails, addresses, bankers, and BVNs (for individuals) / TINs (for corporates), plus % shareholding.

• Evidence of capital contributed by each prospective shareholder, satisfactory and verifiable.

• Notarised irrevocable capital refund mandate.

• Evidence of payment of non-refundable application fee via RTGS to CBN.

• List of proposed directors with emails/addresses/bankers/BVNs.

• Related companies/businesses of shareholders/directors (nature of relation; shareholding).

• Draft MEMART using CBN’s standard template (Appendix 2).

• Detailed business plan/feasibility study (objectives, market need & survey, products/services, ownership table, sources of equity, 5-year projections & assumptions, branch expansion plan for Tier 1, IT requirements/applications).

B) Provisional Approval checklist — Appendix 5 (within 6 months of AIP)

• Application letter to Director, FPRD.

• CTC of Certificate of Incorporation (now you can incorporate with AIP in hand).

• CTC of MEMART and CAC Status Report.

• Evidence of stamp duty on share capital.

• Shareholders’ Register & share certificates.

• Evidence of head office location (owned/rented).

• Evidence of any approved changes in board/shareholding since AIP.

• Executed shareholders’ agreement.

• Senior management list (HoDs+): detailed signed CVs, offers/acceptances, IDs, tax clearance, BVNs.

• Undertaking by shareholders to keep the BDC adequately capitalised.

• Office equipment provided.

• ICT infrastructure proof that:

  • Meets CBN minimum specs;

  • Can verify BVN/TIN/passport/air tickets via APIs (NIBSS, NIS, IATA);

  • Can screen for AML/CFT/CPF risks;

  • Can monitor & file suspicious transaction reports and render CBN returns.

• Service Level Agreement(s) with vendors.

• Commencement plan with timelines.

• Logo/brand identity.

• Board undertaking to comply with all CBN BDC regulations.

C) Final License checklist — Appendix 6 (within 60 days of Provisional Approval)

• Written confirmation from CBN ITD of successful integration with CBN platforms.

• Written confirmation from NIBSS of seamless BVN validation integration.

• Written TED confirmation that an operational code has been issued.

• Written NFIU confirmation that your entity is live and able to render returns.

• Insurance cover evidence.

• Contingency Funding Plan.

• Business Continuity Plan.

• SLA with your CNIB for prepaid card issuance to customers.

• Minutes of pre-commencement board meeting.

• Opening statement of affairs.

• Board attestation of readiness to commence operations.

• Any other document CBN may require.

From BDC to “Authorised Dealer”: joining the market you plan to trade in

The guidelines are explicit: to participate in the Nigerian Foreign Exchange Market (NFEM) as a dealer, a BDC shall apply to the Director, Trade & Exchange Department (TED) of the CBN for an authorised dealership license. Make this application after you have your BDC license and system integrations. This step lets you purchase FX from/sell into the formal market under current market-structure rules (e.g., EFEMS).

Why this matters: EFEMS (the Electronic Foreign Exchange Matching System) is the CBN-mandated platform for interbank FX matching; Authorised Dealer Banks are default participants and all dealers must comply with the FX Code and Market Operating Guidelines. As a BDC seeking dealer status in NFEM, you will be expected to adhere to the FX Code and any operating rules for market participants.

Operational guardrails you must plan for (post-licensing)

• TRMS (Trade Monitoring System): All PTA/BTA and eligible invisible-payment sales run through TRMS forms (e-Form A).

• Payment modalities: For PTA/BTA, at least 75% must be transferred to a prepaid card; only up to 25% can be cash (with an exception for ≤USD500). Purchases above USD500 from customers must be paid to their Naira account (non-resident customers may be issued a prepaid NGN card).

• Integrations: CBN Extranet & returns, FIFX, FinA, CARP, TRMS, FIRS TIN verification, and NIBSS–BVN. These are mandatory before final license.

• Record-keeping & returns: Render daily/periodic returns via FIFX; maintain electronic receipts and auditable transaction trails (with BVN/TIN, KYC, timestamps). Display license and required notices at every location.

• EFEMS/FX Code compliance: If participating in the dealer segment, ensure compliance with the FX Code and any EFEMS circulars/guidelines.

Step-by-step application roadmap (action plan)

1. Decide your tier (Tier 1 nationwide, Tier 2 single state). Build your capital plan accordingly.

2. Reserve company name at CAC (for AIP file only; don’t incorporate yet). Draft MEMART from CBN’s Appendix 2 template.

3. Raise and document capital (no cash; verifiable banking trails). Prepare notarised capital refund mandate.

4. Assemble your AIP pack (Appendix 1) including a strong 5-year plan, projected branches (Tier 1), and IT blueprint. Pay the application fee via RTGS to CBN and include the payment evidence. Submit your AIP letter to the Governor, CBN.

5. After AIP, incorporate at CAC using the AIP letter; complete board & shareholding setup.

6. Within 6 months, apply to FPRD for Provisional Approval with Appendix 5 documents. Get your office and IT infrastructure in place (security, fire/insurance, AML screening, BVN/TIN/passport/air-ticket verifications). Prepare for the CBN pre-licensing inspection.

7. After Provisional Approval, complete integrations with CBN and NIBSS, obtain TED operational code, secure NFIU confirmation, BCP, contingency funding plan, SLA with your banker for prepaid cards, and other Appendix 6 items.

8. Within 60 days, file for Final License, pay the license fee via RTGS when instructed, and receive your BDC license.

9. If you want to deal in the NFEM, apply to TED for authorised dealership license (post-BDC license). Plan for EFEMS participation and FX Code alignment.

Costs & timelines at a glance

Core financials (from CBN):

• Tier 1: ₦2.0bn minimum capital; ₦1.0m application fee; ₦5.0m license fee.

• Tier 2: ₦500m minimum capital; ₦250k application fee; ₦2.0m license fee.

Processing cadence (from CBN):

• AIP → apply for Provisional Approval within 6 months.

• Provisional Approval → apply for Final License within 60 days.
  (Actual CBN review durations are not guaranteed; meet the applicant-side deadlines and be integration-ready.)

Who can (and can’t) own a BDC

CBN lists non-eligible promoters—entities and persons who cannot own BDC equity directly or indirectly (e.g., commercial/merchant/non-interest/payment service banks, OFIs, IMTOs, serving staff of regulators/regulated firms, governments/public officers, NGOs, co-ops, academic/religious institutions, non-Nigerian natural persons, non-resident non-regulated companies, telecom providers, sanctioned individuals, and anyone who already owns shares in another BDC). Ensure your cap table complies before filing.

What a compliant BDC can actually do (and how it sells to end-users)

• Eligible purposes: PTA, BTA, medical bills, school fees, professional exams/annual subscriptions; repurchase of unused Naira from non-residents (with original receipt). Many of these flows require TRMS (e-Form A) and are subject to amount/frequency caps set by CBN. For PTA/BTA, up to 25% in cash and ≥75% to a prepaid card; ≤USD500 may be cash-settled in certain cases.

• Sourcing FX: From customers (diaspora, residents with FX inflows, tourists), from IMTOs, authorised hotels, and—if you hold authorised dealership license—from the NFEM. Sellers of ≥USD10,000 must declare the source and comply with AML/CFT/CPF and FX rules.

• Market infrastructure: If you step into dealer territory (NFEM/EFEMS), comply with the FX Code and EFEMS guidelines/circulars.

Compliance, returns, and inspections you should expect

• Returns are rendered electronically via CBN systems (e.g., FIFX). Keep robust electronic records (location, customer details, BVN/TIN, rate, amount, timestamps), issue electronic receipts, and display license, exchange rates, AML/CFT/CPF notices, and approved abridged financials at each place of business.

• Corporate governance: Board size & composition rules (e.g., minimum directors vary by tier; at least one INED), gender diversity policy, disclosure of other board seats, approvals for changes.

• Audit & reporting: Annual external audit, submission timelines to CBN, management letters, and record preservation (≥6 years).

• Sanctions: Contraventions attract penalties under BOFIA 2020 and relevant laws; repeated or grave non-compliance may lead to license revocation.

Frequently Asked Questions (from common queries answered by CBN sources)

1) Is there a separate “foreign exchange dealer license” apart from the BDC license?
For banks, authorised-dealer status derives from the bank license and market rules (EFEMS/FX Code). For non-banks, the practical route is the BDC license, followed by an authorised dealership license application to TED to participate as a dealer in the NFEM.

2) What are the official minimum capital and fees for BDC licensing?
Tier 1: ₦2.0bn, plus ₦1.0m application fee and ₦5.0m license fee. Tier 2: ₦500m, plus ₦250k application fee and ₦2.0m license fee. CBN may vary these at its discretion.

3) Do I incorporate at CAC before or after AIP?
After AIP. You must present the AIP letter to CAC; AIP is not permission to commence business.

4) How long do I have between AIP and Provisional Approval, and then to Final License?
You must apply for Provisional Approval within 6 months of AIP; after Provisional Approval, apply for Final License within 60 days.

5) What integrations are mandatory before the final license?
CBN Extranet/returns, FIFX, FinA, CARP, TRMS, FIRS TIN verification, and NIBSS–BVN. You also need TED operational code and NFIU confirmation.

6) Are BDCs allowed to do outward international transfers or trade derivatives/crypto?
No. Those are non-permissible. BDCs may not do outward transfers, derivatives/speculative transactions, or deal in cryptocurrency/virtual assets.

7) How do PTA/BTA sales work now?
Applications go through TRMS; beneficiaries typically receive ≥75% to a prepaid card (≤25% cash), with certain exceptions for ≤USD500. Documentation limits and frequencies apply.

8) What systems govern interbank and dealer operations?
EFEMS governs electronic matching in the interbank market; participants must follow Market Operating Guidelines and the FX Code.

9) Can a BDC source FX from the formal market?
Yes—once it holds the authorised dealership license from TED to participate in the NFEM.

10) Will CBN publish my BDC’s details?
CBN periodically publishes the list of all BDCs and their registered places of business for public information.

Common misconceptions

• “I can incorporate first, then seek AIP.”
  Incorrect. You must obtain AIP before CAC incorporation.

• “BDC license automatically makes me a market dealer.”
  Not exactly. A BDC can sell to end-users immediately after final license, but to participate as a dealer in the NFEM, it must apply to TED for authorised dealership.

• “BDC can pay everything in cash.”
  No. For PTA/BTA, ≥75% must be on a prepaid card; cash is generally ≤25%, with small-ticket exceptions.

• “BDC can run like a mini-bank (take deposits/loans).”
  False. Deposit taking, lending, outward transfers, derivatives/crypto etc. are prohibited.

• “Capital can be funded in cash.”
  No. No cash funding; CBN reviews documented sources and verifies capital.

Final tips to avoid delays or refusals

1. Confirm every shareholder is eligible under CBN’s “non-eligible promoters” list before you file AIP.

2. IT early-start: Do not wait, line up vendors and begin integration readiness (CBN Extranet, NIBSS/BVN, TRMS, AML screening) during the Provisional stage.

3. Paper trails for capital: Ensure verifiable banking evidence for each shareholder’s contribution; no cash.

4. Keep to CBN’s applicant deadlines (6 months; 60 days) and respond promptly to clarifications.

5. Plan for EFEMS/FX Code if you will trade in the dealer segment; keep your operational code and compliance stack in order.

Conclusion

Becoming a foreign exchange dealer in Nigeria, if you are not a bank, means getting a BDC license and if you plan to trade in the market as a dealer—applying to TED for authorised dealership. The CBN’s approved BDC Guidelines (effective June 3, 2024) provide everything you need: capital & fee thresholds, exact documents for AIP, Provisional, and Final stages, integration requirements, and post-licensing obligations. Following the checklists above, funding capital transparently, building the right compliance/IT stack, and meeting CBN timelines will position you for a successful approval—and an operational launch that meets today’s EFEMS/FX Code-driven market standards.