Three Payment Service Banks (PSB) have been granted final approval to operate as PSBs following compliance with licensing requirements, the Central Bank of Nigeria (CBN) said in a tweet today.
The three firms are Globacom’s Money Master, 9Mobile’s 9PSB and Hope PSB a subsidiary of Unified Payment. The apex had issued Approval-in-Principle (AIP) to the three subsidiaries in September 2019.
“The licensing of the new PSBs will strengthen Nigeria’s financial inclusion drive leveraging mobile and digital channels. The CBN is committed to the implementation of policies that will engender a diverse financial system that meets the needs of all stakeholders,” the CBN tweeted.
“The CBN will continue to monitor developments in the sector and grant additional PSB licenses in due course.”
A PSB license allows the companies to among other things; maintain savings accounts and accept deposits from individuals and small businesses, which is covered by the deposit insurance scheme; carry out payments and remittance (including cross-border personal remittance) services through various channels within Nigeria; issue debit and prepaid cards, and operate an electronic purse or wallet.
For a company to obtain the license to operate as a payment service bank the CBN said it would have to provide the financial requirement of N5.35 billion.
“Minimum capital N5,000,000,000.00, Non-refundable application Fee N500,000.00, Non-Refundable Licensing Fee N2,000,000.00 and change of name fee N1,000,000.00,” said a new circular that has the guideline issued by the central bank for licensing and regulation of PSBs.
According to the circular, the structure of the banks include the fact that they shall among other requirements operate mostly in the rural areas and unbanked locations targeting financially excluded persons, with not less than 25 percent financial service touchpoints in such rural areas as defined by the CBN from time to time:
“Enter into direct partnership with card scheme operators. Such cards shall not be eligible for foreign currency transactions; deploy ATMs in some of these areas; deploy Point of Sale devices,” the apex bank stated.
Payment Service Banks according to the central bank shall not grant any form of loans, advances and guarantees (directly or indirectly) or accept foreign currency deposits; deal in the foreign exchange market except as prescribed by the CBN.
They shall also not participate in insurance underwriting; undertake any other transaction which is not prescribed by this Guidelines, and shall not accept any closed scheme electronic value (e.g. airtime) as a form deposit or payment.
The apex bank said the license of a PSB may be revoked by the regulator subject to any of the following conditions: Failure to comply with any of the provisions of the PSB Guidelines or other circulars and Guidelines issued by the CBN from time to time, failure to comply with the provisions of the BOFIA, and Voluntary liquidation by a PSB with the prior written approval of the CBN.