How to Start a Bureau De Change Business

A bureau de change is authorized to carry out foreign exchange transaction. They deal in all major currencies such as the Dollar, Yen, Pounds, Euro and local currency.
Very few companies and individuals have access to foreign currency because of bank bureaucracy. This is why foreign exchange dealers provide valuable service to customers.
Challenges
Forex dealers face lots of challenges such as funding, security and cash liquidity. Others include robberies, strict operational regulations and frequent policy changes by federal government.
Things to Consider
There are a few things to consider before launching your enterprise. You need to apply for a license, financials and structure a management team.
What are your internal controls, non-permissible activities? There are also operational and anti- money laundering provisions.
money
Funding Sources
You need a minimum of N100 million to start the business. Secure funds from venture capitalists, core investors, and share equity investors. You could try obtaining bank loans or partnership arrangements.
Write a Business Plan
Start by writing a Bureau De Change business plan and carry out a feasibility study. Focus on funding, paid-up share capital, licensing and operational office. Learn the intricacy of the business and find an ideal location.
Customer Demography
Foreign exchange dealers service many sectors of the economy. They provide money for students, exporters, travelers, tourists and small business owners. Others include petroleum marketers, importers and manufacturing companies.
Application for Licensing
1.To carry out the business of bureau De Change you need authorization from the central Bank. The application is in two stages API and Final approved license.
To get an approval in principle you pay a non refundable application fee of N100, 000 and minimum capitalization of N35, 000,000 million naira. The said sum is later refunded by the central bank on approval of final license.
 The company needs to present a Business plan and feasibility report to the regulatory body.
2. Contents of the Business Plan and feasibility report
The content of your Business plan and feasibility reports should include your serve, objectives and management structure. Add financial projections, growth indicators and profitability.
The report should have the composition of the board, functions and responsibilities. Make provisions for anti-laundry laws of compliance.
3. You need to add a letter of intent of shares of each subscriber and a draft memorandum and Article of Association.
4. The business name should be incorporated at the corporate affairs commission. Once the board has been approved a commercial bank may grant approval to commence business.
The approval in Principle is only temporary before the final approval by the regulatory body.
Final License
Once you have an Approval-in-Principle you should apply for final approval. This should be done six months after the AIP.
You submit an application to the central bank with a non refundable sum of N1, 000,000 million Naira. Include CV of top management team, evidence of incorporation, suitable operational office and evidence of mandatory caution deposit.
The caution deposit is N35 million Naira and refundable once you start the operation. The license is granted subject to the fulfillment of CBNs conditions.
Final License Requirement
  • Minimum paid-up share capital N35 million
  • Non refundable change of name fee N100,000
  • Non-Refunded annual license N250,000
  • Mandatory caution deposit N35 million
  • Non-Refundable application fee N100,000
Hire Staff
Hire a management director or chief executive officer. Other management staffs include compliance officer, management staff and regular staff.
Bureau De Change Operations
A bureau de change is approved to deal in bank notes, coins and plastic cards. The foreign currency should be sourced locally or through the central bank.
Any one changing more than $10,000 are required to disclose source of funds. Business deals are deemed spot transactions and forward transactions prohibited.
BTA and PTA transactions are pegged at maximum of $4000-$5000. You are mandated to keep proper registers and records of transactions.
The buying and selling rates should be conspicuously displayed for customers. Travelers seeking foreign exchange should present travel documents before allowed to purchase foreign currency.
Penalties
There are lots of penalties such as license revocation or fine fees. Infractions are engaging in prohibited activities and under subscription of minimum paid-share capital.
Others are failure to obtain CBN approval. Operating without a valid license and late rendition of regulatory returns are penalized. More are submitting false information and failure to comply with policies and guidelines.
Marketing
Offer repeat customers small discounts, enter into strategic partnerships and advertise. Use visible sign boards, television and radio advertisement. Build a website and engage in social media posting.





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