According to the records of the Nigeria Inter-Bank Settlement System Plc (“NIBSS”) as of July 2021, there are 986,252 registered PoS terminals in Nigeria. But the total number of deployed PoS terminals as of January 2023 was 955,234. Although unconfirmed report shows that there are over 1.4 million mobile money and banking agents across the country. Some of the operators and agents are neither registered with the Corporate Affairs Commission (“CAC”) not licensed by the Central Bank of Nigeria (“CBN”).
Super-Agents are Fintech companies with the lowest capital requirement threshold (being N50 Million) in the payment ecosystem in Nigeria licensed by the CBN to undertake financial services on behalf of banks to unbanked communities or population in order to increase financial inclusion to those who would have been otherwise unable to benefit such financial services under formal banking system.
A Super-Agent company is required to be registered with the CAC, however, such registration cannot be completed unless with the approval of the CBN and subject to deposit of N50 Million in an escrow account with the CBN and submission of several other documentary requirements.
In an interview with The Punch by the National President, Association of Mobile Money and Bank Agents in Nigeria, Mr. Victor Olojo, said the CBN is set to clampdown on illegal Point of Sales operators in the country. According to Mr. Olojo and The Punch, “2023 is expected to witness growth in PoS transactions.……Agents must wake up, there are rules. Agents operating under an umbrella, agents hawking PoS services, all these things would soon be curtailed. The CBN is coming with a sledgehammer very soon on agents operating outside its guidelines…..Some of these agents are not properly registered; the minimum accepted is a kiosk, an identifiable address.”
Also, the Economic and Financial Crimes Commission (“EFCC”) has expressed concern over the issuance of PoS machines to persons of questionable characters. The anti-graft agency has threatened to deal with illegal PoS Operators across the country. See the publication by the EFCC here.
What is the procedure for licensing a Super-Agent Company in Nigeria?
Usually, the procedure to adopt will depend on if the applicant company has been fully registered or seeking to be newly registered with CAC.
Existing Company: For an existing company, there is a number of house-keeping issues to tidy up (depending on the state of the company, the nature of its business and amount of its share capital):
i. It may be necessary to first file an application to CAC to increase the share capital to N50 Million if the amount of its share capital is less than N50 Million;
ii. It may also be important to amend the Memorandum and Articles of Association (“MEMART”) of the existing company to reflect only permissible business activities relating to agency banking (the Draft Amended MEMART is acceptable for Super Agent Application purposes);
iii. It may also be necessary to appoint new directors on the board, where the number of directors is less than five (5) and file the application for the new appointments with the CAC together with all the necessary resolution and other post incorporation filings at the CAC.
The above and other Super Agent requirements are necessary before submission of Application for Super Agent licence to the CBN.
New Company: The process for a new company begins with the reservation of the proposed name with the CAC and thereafter the application for Approval In Principle (“AIP”) to CBN is processed in the reserved name subject to payment of application fee and shareholders’ fund as well as presentation of documentary requirements. An AIP has a lifespan of 6 months, though may be extended by the CBN.
Upon the grant of the AIP, the promoters are required to return to the CAC to complete the registration of the Super-Agent company (within 6 months of the grant of the AIP) following which the CAC will issue a certificate of incorporation, a memorandum and articles of association and a status report of application for registration showing details of the company including share capital, registered address, directors, shareholders, company secretary and other relevant information of the company.
Upon completion of the company’s incorporation, the company is required to apply to the CBN and make payment of the licensing fee before the Final Licence issued. The operating licence of a super-agent is renewable every two (2) years, subject to satisfactory performance of the licensed company.
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