HIGHLIGHTS OF THE CBN’S CIRCULAR ON ISSUANCE OF GUIDELINES FOR LICENSING AND REGULATION OF PAYMENTS SERVICE HOLDING COMPANIES IN NIGERIA

The Central Bank of Nigeria (“CBN”), on the 3rd of August, 2021, issued a circular to all Deposit Money Banks (“DMBs”), Payment Service Providers and Other Financial Institutions (“OFI”) on issuance of the Guidelines for Licensing and Regulation of Payment Service Holding Companies (“PSHC”) in Nigeria (“the PSHC Guidelines”). The circular is primarily for companies that desire to operate more than one licence category, (switching, processing and/or mobile money services) to set up a Payment Service Holding Company (“PSHC”) structure, such that the activities of the subsidiaries are clearly delineated. According to the CBN, the arrangement would prevent commingling of activities, facilitate management of risks and enable the CBN exercise adequate regulatory oversight on all the companies operating within the Group.