The Federal Government has taken a significant step toward regulating the Point of Sales (PoS) industry by mandating the registration of 1.9 million PoS operators.
In line with legal requirements and the directives of the Central Bank of Nigeria (CBN), the Corporate Affairs Commission (CAC) has set a two-month deadline for PoS companies to register their agents, merchants, and individuals with the commission.
During a meeting held in Abuja, Fintech representatives engaged in fruitful discussions with the Registrar-General of CAC, Hussaini Ishaq Magaji, to finalize the agreement. The Nigeria Inter-Bank Settlement System has reported that there are currently over 1.9 million PoS terminals deployed nationwide by merchants and individuals.
The primary objective of this registration initiative is to safeguard the interests of Fintech customers and strengthen the overall economy. Registrar-General Magaji emphasized that this action is fully supported by Section 863, Subsection 1 of the Companies and Allied Matters Act (CAMA) 2020, as well as the 2013 CBN guidelines on agent banking. It is important to note that the registration timeline, which expires on July 7, 2024, is not intended to target specific groups or individuals but rather to provide comprehensive protection for businesses.
In a statement released by the commission, it was announced that “The Corporate Affairs Commission and Fintech companies in Nigeria, commonly known as PoS operators, have reached an agreement to register their agents, merchants, and individuals with the CAC within a two-month timeframe, in accordance with legal requirements and the directives of the Central Bank of Nigeria. This agreement was reached during a meeting held today between Fintechs and the Registrar-General, CAC, Hussaini Ishaq Magaji, in Abuja.”
This new directive comes in response to the increasing occurrence of fraud incidents involving PoS terminals and the CBN’s plans to restrict trading in cryptocurrency or any virtual currency. According to a fraud report by the Nigeria Inter-Bank Settlement System Plc, PoS terminals were responsible for 26.37% of fraud incidents in 2023.
Recently, the CBN prohibited major fintech firms such as Kuda, Opay, PalmPay, and Moniepoint from onboarding new customers and instructed them to caution their users against engaging in cryptocurrency or virtual currency trading on their platforms. The CBN’s actions are part of an ongoing audit of the Know-Your-Customer process of these fintech companies, which have faced scrutiny due to concerns related to money laundering and terrorism financing.
Prior to the CBN’s directive, the Economic and Financial Crimes Commission obtained a court order to freeze at least 1,146 bank accounts belonging to various individuals and companies allegedly involved in illegal foreign exchange transactions.
In response to the government’s directive, OPay, a prominent fintech company, stated that it will take strict measures against customers who violate its policies, in line with the Central Bank of Nigeria’s position on cryptocurrency trading.
The statement released by the commission also highlighted that several speakers from the fintech industry pledged their collaboration to ensure the smooth implementation of this directive. Furthermore, they emphasized the need for comprehensive and collective awareness campaigns to ensure that the registration exercise achieves the desired results.
