In 2020, the Central Bank of Nigeria (CBN) published the CBN Circular on New Licence Categorisations for the Nigerian Payments System wherein it mandated financial technology companies desirous of operating switching and mobile money business to adopt a holding company (Holdco) structure.
At the time, there was no specific regulation applicable to the implementation of Holdco structures by payment and fintech companies. The primary instrument that regulated the operation of holding companies within the financial services sector was the CBN Guidelines for Licensing and Regulation of Financial Holding Companies in Nigeria (Financial HoldCo Guidelines) which was issued by the CBN for banking groups handling other non-core banking activities.
The CBN has now issued the Guidelines for Licensing and Regulation of Payments Service Holding Companies in Nigeria (PSHC Guidelines) which regulate the implementation of Holdco structures by payment and fintech companies.
The Newsletter sets out the key provisions of the PSHC Guidelines.