In a significant move, the Central Bank of Nigeria (CBN) has barred banks and fintechs from participating in international money transfer services. Accompanying this decision is a staggering 1,900% surge in the application fee for licensing International Money Transfer Operators (IMTOs).
The CBN’s directive, revealed in a document dated January 31, 2024, states that banks are now prohibited from directly operating international money transfer services but are permitted to act as agents. Simultaneously, fintech companies are no longer eligible for IMTO approval, marking an expansion of the guidelines from 2014.
The application fee for IMTO licensing has skyrocketed from N500,000 to N10 million, marking a substantial increase over the past decade. Prospective IMTOs eyeing operations in Nigeria must submit applications along with a non-refundable fee of N10 million. Prerequisites for the application include approval to operate in other jurisdictions, evidence of tax clearance, and incorporation documents.
The CBN document emphasizes, “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 and payable to the CBN through electronic transfer or bank draft.”
Additionally, IMTOs will face an annual renewal fee of N10 million or an amount specified by the CBN, payable by January 31 each year.
This revision signifies a substantial shake-up in the money transfer landscape, impacting banks, fintechs, and IMTOs, with implications for the broader financial sector in Nigeria.
