The Central Bank of Nigeria (CBN) has established a minimum operating capital requirement for International Money Transfer Operators (IMTOs) at $1 million for foreign entities and an equivalent amount for local IMTOs.
This significant development was outlined in the revised guidelines for the operation of IMTOs, which were officially released on January 31, 2024.
According to the guidelines, applicants must adhere to the CBN’s anti-money laundering, combating the financing of terrorism, and countering proliferation financing of weapons of mass destruction regulations.
These regulations are detailed in the CBN guidelines for licensing banks and other financial institutions in Nigeria.
IMTOs intending to operate in Nigeria are required to submit their applications to the director of the trade and exchange department, along with various documentation.
This includes a non-refundable application fee of N10 million only, or an amount specified by the Bank. Other necessary documents encompass approval to operate in other jurisdictions or agency agreements, evidence of tax clearance, and incorporation documents for indigenous IMTOs.
Furthermore, the ownership structure of the IMTO, board approval to operate international money transfer services, and profiles of the company’s board and management are essential requirements.
The documentation process also mandates information on beneficial owners (BO) of the company, credit reports from licensed credit bureaus for shareholders and key officers.
These stringent measures aim to enhance transparency, accountability, and regulatory compliance within the international money transfer sector. IMTOs are also expected to provide any other information, documents, and reports specified by the CBN from time to time.
The CBN’s decision underscores its commitment to fostering a robust financial environment and ensuring the integrity of money transfer services within Nigeria.
The CBN also introduced a mandatory annual renewal process for IMTOs, signaling a heightened commitment to regulatory oversight in the financial sector.