The Corporate Affairs Commission has announced that it will begin taking stringent actions, including shutting down Point of Sale businesses that did not comply with its registration requirement by the September 5 deadline.
This was disclosed in a public notice released on Friday.
The CAC indicated that compliance levels have been insufficient and warned that non-compliant businesses might be involved in “unwholesome activities.”
This announcement follows legal challenges from the Association of Mobile Money and Bank Agents in Nigeria which argues that the CAC’s registration mandate is illegal.
The dispute highlights ongoing tensions between regulatory authorities and fintech operators in the country.
Providing an update on the registration after the Thursday deadline, the CAC in the public notice said
“The Corporate Affairs Commission wishes to remind the general public particularly Fintech operators also known as Point of Sale (POS) operators, that the 60-day deadline given in daily newspaper publications of July 7 2024, for the registration of such businesses expired on September 5, 2024.
“The Commission notes inadequate compliance with the directive for formalization when viewed from the background of the large number of POS operators in the country. Those who have taken steps to formalize in line with the Commission’s directive are commended for their positive attitudes.
“Recalcitrant operators have refused to adhere to the advice for formalization due possibly, to engagements in unwholesome activities or for some reasons best known to them.
“We are to make it clear that the Commission is working with Law Enforcement Agencies and other relevant stakeholders to deploy comprehensive enforcement and sanction framework that may include not only possible shutdown but other severe legal Consequences.”
Recall the CAC in May announced that PoS agents of major fintechs in Nigeria including OPay, Palmpay, and Moniepoint, among others, had been given a deadline of July 7, 2024, to register their business.
The Registrar-General of CAC, Hussaini Magaji, announced that the decision to take action against non-compliant Point of Sale (PoS) businesses follows an agreement reached with PoS operators during a recent meeting in Abuja.
Magaji emphasized that the registration mandate aligns with both legal requirements and directives from the Central Bank of Nigeria.
However, AMMBAN contends that the CAC’s registration requirements violate the Companies and Allied Matters Act, Laws of the Federation of Nigeria, 2004, which stipulates that the Commission lacks jurisdiction over individuals not operating as companies.
AMMBAN National General Secretary, Oluwasegun Elegbede noted that the issue is currently before the court, with hearings scheduled for September.
“The court will have to intervene in the interpretation of the quoted section of the CAMA if individuals operating as a sub-agent (likened to a bank branch) must register with CAC,” he stated.
The CAC’s directive on the registration of PoS businesses comes amid increased incidents of fraud involving PoS terminals and the CBN’s ongoing plans to halt trading in cryptocurrencies and other virtual currencies.
