Nigeria: CBN Sets $1 Million Minimum Capital Requirement for International Money Transfer Operators

The Central Bank of Nigeria (CBN) has established a minimum share capital requirement of $1 million for International Money Transfer Operators (IMTOs) operating in the country. This information was disclosed in the revised guidelines for the operation of IMTOs, officially released on the CBN’s website and signed by Dr. Hassan Mahmud, the Director of the Trade & Exchange Department.

The CBN’s latest directive is part of policy reforms aimed at strengthening the foreign exchange market in Nigeria and promoting fund remittances through legal channels.

According to the guidelines, applicants must adhere to the CBN’s regulations on anti-money laundering, combating the financing of terrorism, and countering the proliferation financing of weapons of mass destruction.

Regarding required documents, the CBN specified, “Any IMTO intending to operate in Nigeria shall submit its application to the Director, Trade and Exchange Department with the following documents: A non-refundable application fee of N10,000,000.00 (Ten Million Naira only) or such other amount that the bank may specify from time to time; payable to the CBN through electronic transfer or bank draft.

“Approval to operate in other jurisdictions or agency agreements (for all IMTOs). Minimum share capital of $1 million for foreign IMTOs and the equivalent for indigenous IMTOs.”

The bank clarified that compliance with the stipulated requirements and receiving a favorable outcome would provide the applicant with an Approval-In-Principle (AIP) to proceed with opening a bank account and processing pre-operational procedures.

“An AIP cannot be used by an IMTO to commence operations, and the AIP may be withdrawn if the IMTO does not meet the requirements stated above,” added the CBN.

For final approval, the central bank outlined, “All IMTOs shall submit an application to the CBN for final approval not later than three months after obtaining AIP, subject to the fulfillment of the following requirements: Names of Authorized Dealer Bank(s) to serve as local agents and a copy of the agency agreement. Submission of a detailed business plan to the CBN, which includes the following: Nature of the business, Internal control systems and monitoring procedures, and more.”

Additionally, IMTOs are required to pay an annual renewal fee of N10 million or any amount specified by the bank on or before January 31st of each year. Renewals of IMTO licenses are expected to be completed within the first quarter of every year.