This decision was reached during a meeting between Fintechs and the Registrar-General of CAC, Hussaini Ishaq Magaji, in Abuja on Monday.

There are currently over 1.9 million POS terminals deployed by merchants and individuals nationwide, according to the Nigeria Inter-Bank Settlement System.

Speaking at the meeting, the CAC boss stated that this measure aims to safeguard the businesses of Fintech customers and strengthen the economy.

He emphasized that the action is supported by Section 863, Subsection 1 of the Companies and Allied Matters Act (CAMA) 2020, as well as the 2013 CBN guidelines on agent banking.

The deadline for registration, which expires on July 7, 2024, is not targeted at any specific groups or individuals but genuinely aims to provide protection for businesses, according to the CAC.

A statement by the commission read, “The Corporate Affairs Commission and fintech companies in Nigeria, better known as POS operators, have agreed to a two-month timeline to register their agents, merchants, and individuals with the CAC in line with legal requirements and the directives of the Central Bank of Nigeria.”

This directive comes in response to frequent fraud incidents involving POS terminals and the Central Bank of Nigeria’s plans to stop trading in cryptocurrency or any virtual currency.

According to a fraud report by the Nigeria Inter-Bank Settlement System Plc, POS terminals accounted for 26.37 per cent of fraud incidents in 2023.

Last week, the CBN instructed major fintech firms like Kuda, Opay, PalmPay, and Moniepoint to stop onboarding new customers and to warn their customers against trading in cryptocurrency or any virtual currency on their apps, threatening to block any accounts found engaging in such activities.

This move by the CBN is linked to an ongoing audit of the Know-Your-Customer process of the fintechs, which have been under scrutiny in recent months over concerns around money laundering and terrorism financing.

Before the CBN’s directive, the Economic and Financial Crimes Commission obtained a court order to freeze at least 1,146 bank accounts owned by various individuals and companies allegedly involved in illegal foreign exchange transactions.

In a notice issued on Friday, Opay stated that it would take strict measures against customers who violate its policy, which aligns with the Central Bank of Nigeria’s stance on cryptocurrency trading.

The statement added that several speakers from the fintech industry pledged to collaborate with the commission to ensure the hitch-free implementation of the directive.

Some of them, however, stressed the need for adequate and collective sensitization to ensure that the exercise achieves the desired results.

This move comes after PoS operators, under the Association of Mobile Money and Bank Agents in Nigeria, attempted to implement new pricing for PoS transactions starting on July 17, 2023.

According to the FCCPC, any PoS operator found in breach of the cease-and-desist order will face severe penalties, including a fine of N10 million for corporate entities and a fine of N1 million or a prison sentence of up to three months for individuals.

In a statement signed by its Executive Vice Chairman/Chief Executive Officer, Babatunde Irukera, the FCCPC clarified that it does not seek to restrict the prerogative of PoS service providers to determine their prices.

However, they emphasize that pricing should adhere to Section 127 of the Federal Competition and Consumer Protection Act 2018, which prohibits manifestly unjust or exploitative prices.

The commission further affirms its support for a pricing methodology driven by market forces in a free, competitive, and undistorted market. They stress that there is no evidence of a lack of sufficient players or competition in the PoS market, both in Lagos and elsewhere.

While the FCCPC values a cautious and collaborative approach, it now issues the Order & Notice (ONC) to the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN), as well as individual PoS operators, instructing them to cease any conduct that violates the law.

The ONC has been officially served on AMMBAN, and the commission ensures that the dissemination process will reach all relevant parties, including non-AMMBAN members. The FCCPC emphasizes its commitment to enforcing the law and warns that violators and their affiliates may face prosecution and statutory liabilities for non-compliant conduct.

Though the commission prefers not to disrupt small enterprises, it retains the authority to prohibit merchant services and privileges to PoS operators or AMMBAN members who persist in activities inconsistent with the law and economic efficiency.