The Central Bank of Nigeria (CBN) has approved new minimum capital requirements for payment service providers and other financial institutions in the country in a bid to “promote a strong and credible payment system.”
In a circular issued to payment service providers, banks and other financial institutions on Thursday endorsed by Musa I. Jimoh, CBN’s director of payments system management, the apex bank announced that Mobile Money Operations (MMOs) with operational licenses for e-money issuing, wallet creation and management as well as pool account management were henceforth required to have a minimum capital of N2 billion.
In the same vein, the CBN demanded that switching and processing firms, whose activities span card processing, switching, non-banking acquiring services, and transaction clearing and settlement agents services, provide at least N2 billion as capital. N100 million capital was stipulated for payment terminal service providers and payment solutions service providers.
The activities of this payment service classes include POS terminal ownership, POS terminal deployment and services, merchant/agent training and support, payment solution/application development, merchant service aggregation and collections, and payment processing gateway and portals.
The CBN said super agents, whose operations comprised agent recruitment, management and other activities as detailed in the regulatory framework for licensing super agents, were required to have N50 million. Payment solution services now have a minimum capital base of N250 million.
“Only MMOs are permitted to hold customer funds. Companies with licences within any of the other categories are not permitted to hold customer funds. “Companies seeking to combine activities under the Switching and MMO categories are only permitted to operate under a holding company structure with the subsidiary entities clearly delineated to prevent comingling,” the CBN said.
Source: Ripples Nigeria