Central Bank of Nigeria on Thursday approved new license categorisations for payment systems in the country.
The apex bank in a circular to all Payment Service Providers (PSPs) signed by Musa I. Jimoh, the Director, Payments System Management Department, stated that the new development was to promote a strong and credible payment system in the country.
According to the circular, “All payment service providers and other stakeholders are to note that payments system licensing has been streamlined according to permissible activities in four broad categories: Switching and Processing; Mobile Money Operations (MMOs); Payment Solution Services (PSSs); and Regulatory Sandbox.”
CBN also informed that the minimum capital requirement for operating MMO is N2 billion, Switching and Processing N2 billion, PSS N250 million, Super Agent N50 million, Payment Solution Service Provider (PSSP) N100 million and Payment Terminal Service Provider (PTSP) N100 million.
While there was no minimum capital requirement is applicable for the operating of a Regulatory Sandbox. “Only MMOs are permitted to hold customer funds. Companies with licenses within any pf 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 commingling.
“Payments System companies (PSS) category may hold any of PSSP, PTSP and Super Agents license or a combination of the licenses thereof.
“All licensed payment service providers in any of the categories covered by this framework holding or seeking any other CBN issued licenses are required to obtain a no-objection from the Payments System Management Department.
“The object clauses in the Memorandum and Articles of Association of Payment Service Providers shall be limited to the permissible activities under their licensing authorizations.
“All new licensing requests including those with Approvals-in-Principle are to comply with the new requirements immediately. Existing licensed payment companies are to comply with the new licensing requirements where applicable not later than end-June 2021.”
The CBN, however, noted that it will continue to monitor developments in the payments system and issue guidance as may be appropriate.