CAC registration: police will pursue illegal outlet operators

The Federal Government has said that mandatory registration of outlet operators across the country will reduce kidnappings and help security agencies arrest recipients of ransom payments for kidnap victims.

He also promised that security agencies would go after outlet operators who did not comply with the directive to register with the Corporate Affairs Commission after July 7, 2024.

The Registrar General of the CAC, Hussaini Magaji, disclosed this at the formal launch of the CAC register of fintechs agents and traders on Wednesday in Abuja.

The event also marked the inauguration of a 24-hour service center to help potential applicants get a quick response to their queries and approvals.

The government, through the commission, on Monday issued a two-month registration deadline for PoS operators to register as corporate entities with the commission in accordance with legal requirements and directives of the Central Bank of Nigeria.

The move 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, aims to safeguard businesses and strengthen the economy.

It also came against the backdrop of frequent fraud incidents involving PoS terminals and plans to stop trading in cryptocurrencies or any virtual currencies by the Central Bank of Nigeria.

PoS terminals accounted for 26.37 percent of fraud incidents in 2023, according to a fraud report by Nigeria Inter-Bank Settlement System Plc.

Last week, the CBN stopped major fintech companies such as Kuda, Opay, PalmPay and Moniepoint from onboarding new customers. Fintech companies subsequently warned their customers against trading cryptocurrencies or any virtual currencies on their apps, threatening to block any accounts found to be involved in such activities.

Speaking at the event, Hussaini reiterated the government’s determination to fully implement the mandate by providing a fully digitized service center to facilitate registration.

He emphasized that the registration process aligns with both legal requirements and CBN directives that require individuals, traders or business entities to be captured in its database.

He further warned that the 60-day period would not be extended and stressed that defaulters would receive appropriate punishments once the period expired.

He said, “We have launched a 24-hour service center to address queries from point of sale operators and agents who want to register as per the new policy. The secretariat is full of staff members who have responsibility for availability, and some have responsibility for approving requests. We have equipped the secretariat with the necessary facilities.

“This is to show you how the government is taking this issue seriously and the center will be open to provide 24-hour service. It will be open to compliance and any comments from the public, especially from point-of-sale operators who have been mandated to register their businesses with the commission.”

He added: “We have trained our staff to adapt to these activities and these staff can work from home and that is why we said 24-hour service. We have equipped them with facilities and they can work from home for approvals and segment availability. The deadline is still 60 days and will end on July 7.”

The CAC chief further stated that the schedule was not intended for specific groups or individuals, but was actually aimed at safeguarding businesses.

The CAC chief explained: “Of course, mandatory registration will reduce crimes and fraudulent practices, the commission hosts data and if any crime is committed somewhere, security agencies would have to contact us to know the people behind the company and the scammers. . But if they are not registered we can’t do anything and that is the essence of registration.

“We have had a situation where a ransom is paid with a PoS terminal and there is a lot of fraud, but after registration, if something happens, we can provide the details of the people behind the company to the government. We will capture the image and other relevant information and this is a good step forward for the country.”

He stressed that “after the deadline we will go after the defaulters. “If you have been identified as a criminal, the security agents will go after you, we will go after them because some are already being chased by the security agencies.”

He explained the benefits of registration and emphasized that it goes beyond taxes and encompasses access to loans, legality and compliance with regulatory requirements.

“The law has established that for any person to carry out a commercial activity in the country, his business must be legitimate and for his business to be legitimate he must register, whether you are doing your business as an individual or as an agent, you must register with we.

“POS terminal holders are doing business and we are now enforcing part of the provisions of the Companies and Allied Matters Act. We have been on this topic since December and extending it to July means they have six months. We have provided a schedule in the interest of your business.

Point of sale operators react

Meanwhile, PoS officers reacted to the order by asking them to register with the CAC.

While some agents agreed with the CBN, many said it would put a greater burden on operators, especially those in rural communities.

The National President of the Banking and Mobile Money Agents Association of Nigeria, Sarafa Fasasi, in a reaction to his charge, said the directive was confusing.

“The memo confused me because the current CBN agent banking regulations allow people to join as agents under the sub-agent category. Currently, Nigeria has more than 1.9 million agents, of which more than 70 percent are sub-agents without registered companies, operating under a network of agents (super-agent arrangements). They are the most penetrating channel of financial inclusion. Now we want to delete them with CAC registration? he asked.

Fasasi noted that the nation should be able to achieve payment security without reversing the 74 percent financial inclusion rate.

He posited: “On the suspension of account creation of major service providers, mainly non-banking such as Opay, Palmpay, Moniepoint, Kuda Bank and others, due to alleged foreign exchange and cryptocurrency transactions; It is worth remembering that before the Binance controversies, forex/cryptocurrency transactions, at one time or another, ended up in multiple accounts or wallets, across all service providers, banking and non-banking. Therefore, all service providers can be guilty and, to be fair, should be suspended.

“I can’t imagine suspending all commercial banks from opening new bank accounts due to pre-regulation transactions.”

Similarly, a point of sale agent, Ogunfowokan Temitope, located in Ilasa area of ​​Surulere, Lagos State, said the move was unfair against the agents.

She said: “It’s not fair because most PoS agents only have a small amount of money. Some even borrowed money to start a business. This group of people, how will they manage? Do you know how much it costs to register a company now?

However, the immediate past president of the association, Victor Olojo, endorsed the CBN’s move, stating that it was the necessary measure for standardization and greater security.

He said: “Since this is a financial issue, the CBN must ensure that the financial system is well galvanized. Nowadays we see people selling and manipulating PoS terminals, which should not even have any kind of commercial management.

“Furthermore, this measure would eliminate them and allow those with capacity to focus on the business, thus Nigeria would be better served.”

He noted that it is an advantage for the CAC and added that millions of unregistered PoS agents are properly regularized.

“We would start having a merchant identity or a unique identifier generated for a specific PoS agent. This means that all PoS accounts opened will now have the appropriate Know Your Customer level 3 standard, where you will have all the necessary verifications connected to your account.

“That way, if there is any problem, the PoS agent can be easily tracked and arrested, thereby curbing fraudulent practices by the agents,” he added.

Corroborating Olojo’s position, a PoS agent located in Berger area of ​​Lagos State, Sunday Samuel, said the move was laudable as it was aimed at standardizing the agents’ businesses.

He said: “The move will help agents standardize their businesses, however, not everyone would understand it from this perspective.

“There are agents in rural areas who do not know what the Corporate Affairs Commission is about or the importance. Therefore, they may find it difficult and stressful to complete the registration procedure. However, seen in a normal way, having the company registered is a good step.”

Meanwhile, another agent located in Mowe-Ibafo area of ​​Ogun State, Taiwo Shobowale, argued that the new directive would affect operators because most of them are not oriented on what it means to be registered with the CAC, adding that These agents take it as a daily source of income.

“Most agents do not see this business as an entity, however, the provision of financial services can be very sensitive as the government wants to get involved. The market is already saturated and fraudulent transactions are rarely traced due to inadequate KYC standard and lack of proper documentation.

“In addition, the notice is sudden and the deadline given is short because it is a project that should last the rest of the year. Rushing would cause a slowdown in the commission system, leading to delays,” Shobowale added.

According to the Nigerian Interbank Settlement System, there are over 1.9 million PoS terminals deployed by merchants and individuals across the country.