Business

Nigeria New Anti-Fraud Law Mandates 1.9 Million PoS Agents To Register With CAC

To combat rising fraud, Nigeria requires its 1.9 million PoS agents to register with the Corporate Affairs Commission (CAC), following a report that PoS terminals contributed to over 26% of fraud cases in 2023.

Published

2 years ago

May 7, 2024

VerseNews

Nigeria New Anti-Fraud Law Mandates 1.9 Million PoS Agents To Register With CAC

Fintech firms like Moniepoint are now integrating CAC registration into their platforms to simplify compliance and maintain business efficiency.

To tackle increasing fraud and enhance transparency, Nigeria now mandates its 1.9 million Point of Sale (PoS) agents to register with the Corporate Affairs Commission (CAC).

VerseNews reports that this decision comes in response to PoS terminals being involved in over a quarter of fraud cases in 2023, as noted by the Nigeria Inter-Bank Settlement System Plc (NIBSS).

Previously, companies like Moniepoint, OPay, and PalmPay allowed PoS agent onboarding with minimal formalities, but the new rule necessitates formal business registration.

To simplify this process, Moniepoint and other fintech firms are integrating direct CAC registration capabilities into their platforms.

This regulatory change aims to bolster regulatory oversight but introduces challenges for fintech firms and small businesses using PoS systems.

This Online News Platform recalls that in 2013, the Central Bank of Nigeria (CBN) introduced agent banking and point-of-sale (PoS) systems to widen access to financial services, addressing the need for more banking infrastructure due to the rapidly growing population.

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PoS terminals quickly became pivotal, with more than 1.8 million agents by 2022, significantly boosting employment and fostering the rise of fintech companies like Opay, Moniepoint, and Palmpay.

Despite its success, the PoS system has encountered significant challenges, notably a high rate of fraud.

To combat this, on March 9, 2024, the CBN released guidelines to enhance the regulation of agent banking and safeguard customer funds.

Earlier in the year, plans were announced for a new PoS feature designed to detect fraudulent transactions, a collaborative effort between the CBN, the Nigerian Electronic Fraud Forum (NeFF), and the Association of Mobile Money and Banking Agents of Nigeria (AMMBAN).