On the 9th of December, 2020, the Central Bank of Nigeria ("CBN") issued a circular to all Payment Service Providers, Banks and Other Financial Institutions in Nigeria highlighting the New Licensing Categorisations for the Nigerian Payments System ("License Categorisation Circular"). In line with the License Categorisation Circular, the CBN, on May 24, 2021, issued another circular (the "Consolidated Licensing Circular") which now consolidates and highlights in detail all the requirements for obtaining relevant licenses by operators within the Nigerian Payments System.
The highlights of the Consolidated Licensing Circular are follows:
License Categorisation |
Capital Requirement |
Application and Licensing Fee |
Licence Validity |
|
Switching and Processing Licence |
N2,000,000,000 (Two Billion Naira) |
|
1. Approval-in-Principle for six (6) Months 2. Commercial licence validity is as determined by the Bank renewable upon satisfactory performance of operations. |
|
Mobile Money Operator (MMO) Licence |
N2,000,000,000 (Two Billion Naira) |
1. Non-refundable application fee of N100,000.00 2. Licensing fee of N1,000,000.00 to be paid before the issuance of the final licence, if successful |
1. Approval-in-Principle for six (6) Months 2. Commercial licence validity is as determined by the Bank renewable upon satisfactory performance of operations. |
|
Payment Solution Services (PSS) Licence
Please note that a PSS licence application typically comprises PSSP, PTSP and Super-Agent Licence application. |
N250,000,000 (Two Hundred and Fifty Million Naira) |
1. Non-refundable application fee of N100,000.00 2. Licensing fee of N1,000,000.00 to be paid before the issuance of the final licence, if successful |
1. Approval-in-Principle for six (6) Months 2. Commercial licence validity is as determined by the Bank renewable upon satisfactory performance of operations. |
|
Payment Terminal Service Provider (PTSP) Licence |
N100,000,000 (One Hundred Million Naira) |
1. Non-refundable application fee of N100,000.00 2. Licensing fee of N1,000,000.00 to be paid before the issuance of the final licence, if successful |
1. Approval-in-Principle for six (6) Months 2. Commercial licence validity is as determined by the Bank renewable upon satisfactory performance of operations. |
|
Payment Solution Service Provider (PSSP) Licence |
N100,000,000 (One Hundred Million Naira) |
1. Non-refundable application fee of N100,000.00 2. Licensing fee of N1,000,000.00 to be paid before the issuance of the final licence, if successful |
1. Approval-in-Principle for six (6) Months 2. Commercial licence validity is as determined by the Bank renewable upon satisfactory performance of operations. |
|
Super-Agent Licence |
N50,000,000 (Fifty Million Naira Only) |
1. Non-refundable application fee of N100,000.00 2. Licensing fee of N1,000,000.00 to be paid before the issuance of the final licence, if successful |
1. Approval-in-Principle for six (6) Months 2. Commercial licence validity is as determined by the Bank renewable upon satisfactory performance of operations. |
ADDITIONAL REQUIREMENTS
The capital requirement for each of the licence categorization is to be paid to the CBN's escrow account. This sum, which is refundable, must however be paid in full and must be made in the name of the company applying for the licence. Escrowed funds are to be invested in treasury bills, subject to availability of treasury instruments, which would be refunded once the final approval of the CBN is received.
Furthermore, all written application should be addressed to the Director, Payments System Management Department, Central Bank of Nigeria, Abuja accompanied by evidence of payments of application fee and other documentary requirements.
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.