The black market Dollar to Naira exchange rate today, Monday, September 15 is ₦705/$1 buying rate and N710/$1 selling rate according to bureau de change operators popularly called Aboki in Lagos and Abuja.
These buying and selling rates are highly volatile and can vary depending on your bureau de change merchant, time of day, dollar denomination you are buying or selling and your negotiating skills.
At the maximum, you shouldn’t be selling or buying at more than +/- 10 naira from the prices stated above.
The exchange rate between the naira and the US dollar closed at N431/$1 at the Investors and Exporters window, where forex is traded officially.
Naira closed at N431/$1 last week representing a marginal depreciation of 0.13% compared to N429.44/$1 recorded in the previous trading session. The value of FX supply that exchanged hands on Friday totalled $74.68 million which is 31.78% lower than the $109.47 million traded on the previous day.
The exchange rate at the cryptocurrency peer-to-peer FX exchange likewise depreciated to N697.5/$1 on Friday morning from N693.2/$1 recorded as of the same time on Thursday. This represents a 0.62% fall against the US dollar in the P2P market.
The naira is expected to depreciate further, this week as the CBN recently announced that Nigeria’s external reserves fell by 3.6% in August 2022, to $39.024 billion, down from $40.520 billion on December 31, 2021.
One of the major causes of this depreciation is the apex bank’s interventions in the forex market, the Nigerian economy is starved of foreign exchange as currency traders continue to complain about restricted forex liquidity, causing the local currency to depreciate more in the FX market. In response, the CBN tries to sell forex directly to Nigerians who need it from the nation’s foreign reserves.
|Dollar to Naira (USD to NGN)||Aboki Black Market Exchange Rate Today|
|Official CBN dollar rate|
What does the official CBN exchange rate mean?
The Central Bank of Nigeria CBN is the official government agency saddled with the responsibility of controlling the naira exchange rate. One of the methods it employs in doing this is to fix an official exchange rate at which the naira is to be traded against other currencies. The CBN uses this rate to sell Form A – a government intervention through which the CBN sells dollars directly to individual and business travelers, and Form M – a multiagency scheme through which the sells dollars directly to importers in an attempt to stabilize the exchange rate.
This exchange rate is also volatile and the daily fluctuations can be monitored via the official CBN website.
The black market on the other hand popularly called Aboki, are operators who exchange currencies at a premium, usually at a much higher rate than the CBN’s. The CBN has long maintained that the black market account for a small portion of the country’s foreign exchange market.
Why do Nigerians buy foreign currency on the black market?
The deference between the official CBN rate and the Aboki black market in Nigeria is currently above #250/$, and this is despite that fact that the CBN has declared the activities of bureau de change operators as illegal, and ask Nigerians to only exchange their currency at the banks, the black market is still a thriving platform.
To understand why this is, it is important to understand the limitations of the CBN’s interventions.
For starters, the CBN has capped PTA and BTA allowances at $5,000 and $10,000 respectively. Travellers who require more have to rely on the black market to fill in the balance. This means if you are going on vacation or have to pay school fees abroad or pay medical bills, your bills have to be under $5,000 or you have to patronize the black market to source for the balance.
Both PTA and BTA are only available to Nigerian citizens, foreign expatriates who live in Nigeria have to source their forex from the black market when travelling. This means that every time a foreigner is coming in or going out of Nigeria, the Nigerian government doesn’t have any provision for them to access forex, they have to source it themselves on the black market.
Then there is the difficulty in getting dollars at the CBN-approved rate, while every Nigerian is by law entitled to PTA and BTA, the bureaucracy of the process often forces most people to simply source their forex from the black market. Some banks require up to 3 weeks notice and sometimes, the approval from the CBN does not arrive in time. The CBN has to confirm and approve every transaction before the banks can sell PTA and BTA to customers.
For bloggers, freelancers and other Nigerians who earn in foreign currency, it is much more advantageous for them to exchange their currency on the black market. They get #680/$ at the black market compared to the #428/$ they would get at the official CBN market. Nigerians who exchange their dollars at the official government rate stand to loose up to #250 on every dollar exchanged. This is the main reason why most people simply exchange their dollars at the black market.
The exchange rates in the table above were gotten from streets merchants from across Nigeria. Several traders, popularly called Aboki forex merchants were surveyed and the average price from their response is tabulated above.
The exchange rate your Aboki merchant gives you can fluctuate depending on the following;
currency denomination: $100 bills and sometimes $50 bills carry a higher exchange rate compared to $20 and $10 bills at some bureau de change locations in Nigeria. $100 and $50 can exchange for #680/$ while $20 and $10 can exchange for as low as #600/$. Some merchants claim it is easier to sell the higher denomination bills, hence the difference. Be sure to take higher denomination bills at the bank when you go to withdraw.
currency date: Some merchants will flat out refuse to buy bills printed before 2006 or offer lower exchange rates for them. It is important to check the bills at the bank to make sure they are new and recently printed bills.
Your negotiating skills: If you search for the naira to dollar exchange rate on any given day, you will likely see different rates. The rate at which you buy or sell will largely depend on your merchant and how well you can negotiate. You can do market survey at different merchants to determine the average price for the day.
You can dollars directly at the CBN regulated price from your commercial bank. Every Nigerian citizen is entitled to $4000 and $5000 in PTA and BTA respectively, students who also need dollars to pay their school fees abroad can also apply as well as those that need to pay medical bills abroad, importers can also apply through form M.
The CBN strictly controls access to all these programs and buying dollars at CBN price can be very difficult, but citizens that qualify and have genuine need for it can start the application online.
There are bureau de change operators popularly called Aboki in every major Nigerian city. They can be found at airports, major hotels and dedicated markets or commercial areas of the city. Like everything that involves financial transactions, one needs to be very careful when dealing especially with Nigerians. As a safety precaution, make sure to always deal with operators that have a fixed address in a public shop, that way you can always find them in case something goes wrong.
If you are in Ilorin, black market bureau de change operators can be found inside Kwara Hotel complex along Ahmadu Bello Way, just before government house. The operators located there are tested and you can always trust them to give you a fair price.
There are online bureau de change services in Nigeria where you can exchange your currency online without having to take your cash to the merchants’ shop. This is especially useful for security purposes and transaction can be done 24/7.
One website that offers this service is Kiakiafx. The way it works is you transfer the dollars you want to exchange and they will in turn transfer the naira equivalent into your naira account. They monitor and update the prevailing exchange rates on their website.
Yes , dollars can be deposited in a naira account but it will first be converted into naira and the naira equivalent at the CBN regulated exchange rate will be deposited into your naira account. It is easier and better to open a domiciliary account and receive your dollars directly into it, you can then withdraw and exchange at the black market. The difference between the official exchange rate and the black market is upwards of #280/$.
opening a domiciliary account at all commercial banks in Nigeria is free, though most banks do require a $100 opening fee and a $50 operating fee. You can open a Freedom domiciliary account with UBA bank for free, Its zero opening and running balance and does not require the usual two references. Only your BVN and a passport is required to open the account but you will be required to upgrade once you reach $2000 cumulative withdrawal.
The dollar exchange rate is the same in all Nigerian banks because the CBN fixes the exchange rate. If you are receiving dollars into a naira account, you will get a flat rate according to the CBN exchange rate for that day. You can only get flexible rate at the black market.
Yes, the CBN sells dollars directly to individual Nigerians who want to travel or to students that need to pay school fees abroad, or those that need to pay for medical bills through Form A. Importers and other merchants can complete the Form M to buy dollars at the CBN regulated price.
Black market currency merchants popularly known as Aboki is not illegal in Nigeria. Several bureau de change vendors operate openly in all major cities in Nigeria including Abuja and Lagos. Though the CBN has adviced Nigerians not to patronize them but the apex bank will only sell you a maximum of $5,000 if you need dollars to travel out of the country for school fees, medical treatment or tourism, if you need more than the government approved $5k you have to source it on the black market. Furthermore, the government’s PTA and BTA scheme does not cover foreign nationals living in the country, if they need to travel out of the country they will have to source their FX in the black market. The CBN only urged Nigerians to trade dollars through the official means, but the official means has too many bottlenecks that makes it inefficient for most Nigerians to use, thus the apex bank allow the black market to operate unregulated.