In this class we are going to be looking at bureau de change, definition and functions of bureau de change.
Definition of Bureau De Change
Definition: A bureau de change is a place where one form of currency can be traded for another through a broker. It is often called a foreign exchange or currency exchange, this service plays an important part in currency flow between Nations.
In most regions, it is easy to find a bureau de change near airport, railway, train stations, large stores or other places where travelers may enter a country. Large cities with a high rate of international visitors will have dozens of hundreds of bureau de change to provide convenience and competitive rates.
Foreign currency exchange is often seen as a necessary part of international travel. When most regions operated off the use of literal value money, such as gold coins, exchanges could be made by weight. The early use of paper and Fiat money systems created the need for currency exchanges, so that a traveler could easily convert his Homeland money into an acceptable and usable form wherever he wants. Many of first bureau de change Were operated through banks, though many still are, it has also become a large private enterprise.
A bureau de change makes profits and compete by manipulating two variables: the exchange rate they used to calculate transactions, and an explicit commission of the service.
In Nigeria, we have more than 200 bureau de change operators located in every state and they are registered with CAC (Corporate Affairs Commission) and all the members of ABCON (Association of bureau de change operators of Nigeria). All bureau de change operators are regulated by Central Bank of Nigeria. To Learn more on the functions of Central Bank [Click Here]
Functions of bureau de change
Here we take a look at the various functions of bureau de change
- Number one functions of the bureau de change is that they exchange foreign currency for local money for customers.
- They sell foreign currencies.
- They buy foreign currencies.
- Another functions of bureau de change is that they work alongside banks, etc.
- They act as subsidiary of Banks.
- They make International traveling easier.
- They make bank transactions easier for foreign travelers and customers.
Revision Questions on bureau de change
- Briefly explain the meaning of bureau de change.
- State five functions of bureau de change.