The Central Bank of Nigeria (CBN) on 31 January 2024 released its revised guidelines for international money transfer services in Nigeria. The revised guidelines (the "New Guidelines") provides an updated framework for the licensing and operations of International Money Transfer Organizations (IMTOs) in Nigeria. According to the CBN, the New Guidelines were issued in view of recent reforms to liberalize the foreign exchange market, boost diaspora remittances, and enhance the ease of doing business for IMTOs.

In this newsletter, we examine the changes introduced in the Guidelines and how they differ from the previous guidelines issued in September 2014 (the "Previous Guidelines").

1. Licensing Procedure and Fees

The New Guidelines outline a two-step application process for IMTOs – the Approval in Principle and the Final Approval. Each stage requires the submission of specific documentation to the CBN. IMTOs can only commence operations upon the issuance of a final license. Unlike the New Guidelines, the Previous Guidelines did not explicitly provide for a two-stage application process. Applications for an IMTO license are to be made alongside the payment of a NGN10million application fee. An IMTO license is required to be renewed annually at the rate of NGN10million and payable by the 31st of January.

The New Guidelines also state that it is unlawful for any organization or individual to offer financial products that include services for international transfers or remittances unless they have obtained a license from the CBN.

2. Minimum Share Capital

The New Guidelines now state a minimum share capital of $1million for foreign companies and the equivalent in Naira for indigenous companies. The Previous Guidelines on the other hand, required a minimum paid up capital of NGN2billion for indigenous companies seeking an IMTO license and NGN50million for foreign companies. However, unlike the Previous Guidelines, the New Guidelines do not state whether the share capital of an IMTO needs to be fully paid up.

Considering the volatility of the Naira to Dollar exchange rate, the $1million share capital raises the question about whether indigenous companies will be required to increase their share capital every time the exchange rate increases. It is expected that the CBN will clarify this point in due course.

3. Permissible Activities

Under the New Guidelines, IMTO services are now limited to inbound money transfer services alone. This means that IMTOs are only able to provide money transfer or remittance services from a foreign country into Nigeria. This is a departure from the Previous Guidelines which provided for limited outbound money transfer services.

The New Guidelines also expands the scope of the target demographic for money transfer services. While individual customers remain the primary focus, the scope now includes transfers on a "person to person", "business to person", and "business to business" basis as opposed to the Previous Guidelines which only provided for transactions on a "person to person" basis.

In line with the Previous Guidelines, the New Guidelines continue to prohibit IMTOs from purchasing foreign exchange from the domestic foreign exchange market for settlement purposes.

4. Prohibition of Fintechs From Obtaining IMTO Licence

The New Guidelines explicitly bar "Financial Technology Companies" from procuring an IMTO license. Although the New Guidelines do not define what a fintech is, it can be inferred from the CBN's National Fintech Strategy document that fintech companies refers to institutions carrying out payment services under the various Payment Service Provider(PSP) licenses issued by the CBN. However, it will be helpful for the CBN to clarify what it means by Financial Technology Companies.

5. Other Provisions

IMTOs can partner with deposit money banks to act as their agents. IMTOs are required to domicile customer funds for remittance with their agents.

  • All money transfers by IMTOs to beneficiaries must be made in Naira via bank deposit or cash. Cash payments are limited to transfers below the equivalent of $200.
  • The exchange rate used in converting the foreign currency to Naira shall be at the prevailing rate in the Nigerian Foreign Exchange Market on the day the transfer was received.
  • IMTOs are required to state the exchange rate and all applicable charges for each money transfer transaction prior to the conclusion of the transaction.


The CBN consistently demonstrates its role as a proactive regulator with its frequent updates of regulations and guidelines to meet its perception of current needs. It will however be helpful for the CBN to provide clarity and address certain concerns that have arisen from the New Guidelines. Some of these concerns are:

  • the prohibition of fintech companies from acquiring IMTO licenses; and
  • the pegging of the minimum share capital for indigenous IMTO companies to the US Dollar considering the fluctuation of the Naira. It will be preferable for the share capital of indigenous companies to be a fixed amount in Naira.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.