In response to the recent guidelines released by the Central Bank of Nigeria (CBN) on International Money Transfer Operators’ (IMTO) operations, questions have arisen about the standing of Flutterwave, Interswitch, and other Licensed fintechs offering international money transfer services.

The CBN’s new directives explicitly prohibit banks and fintechs from engaging in international money transfer services. Notably, while no banks currently hold an IMTO license, the fate of already licensed fintechs remains uncertain.

Among the licensed Nigerian fintechs are industry leaders like Flutterwave, Interswitch, Paga, Xpress Payment Solutions, and Paycom, as indicated in the CBN’s database, which registers a total of 62 companies, including foreign fintechs, authorized as Imtos in the country.

Key Points from CBN’s Updated Guidelines (Effective January 31, 2024):

1. Prohibition on Fintech Approval for IMTO: The CBN expressly stated that Financial Technology Companies are not allowed to seek approval for IMTO licenses. While this suggests that new fintechs cannot apply for IMTO licenses, the guidelines do not clarify the status of fintechs already holding IMTO licenses.
2. Increased IMTO License Application Fee: The application fee for an IMTO license has been significantly increased from N500,000 in 2014 to N10 million in the latest guidelines, marking an approximately 1,900% surge in the past decade.
3. Operating Capital Requirement Adjustment: The CBN has set a minimum operating capital requirement for IMTOs at $1 million for foreign entities and an equivalent amount for local IMTOs. This represents a notable change from the previous requirement of N2 billion for Nigerian companies and N50 million for foreign entities.
4. Application Submission Requirements: IMTOs seeking to operate in Nigeria are required to submit a non-refundable application fee of N10 million, approval to operate in other jurisdictions, and an agency agreement (for all IMTOs).

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The status of fintechs currently licensed as IMTOs remains unclear, as the CBN did not explicitly state whether they can continue operations under their existing licenses.

For reference, as of July 2023, the CBN had licensed 62 companies as IMTOs. The full list of these licensed companies is provided below:

For the latest updates on the evolving regulatory landscape, stay tuned for further developments in the international money transfer sector in Nigeria.

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