Any business that takes deposits, lends as a regulated institution, deals in foreign exchange or moves money in Nigeria needs a licence from the Central Bank of Nigeria (CBN). Banks and other financial institutions are licensed under the Banks and Other Financial Institutions Act 2020 (BOFIA) and the CBN Act, and payment businesses under the CBN's payment system rules. Operating without the right licence is an offence, and choosing the wrong licence can cost months and a large part of your capital.
Our CBN licence lawyers advise on every category of CBN licence. We tell you which licence your business model needs, what capital and people the CBN will expect, and how long the process is likely to take, before you commit money to it.
CBN licences we obtain
Banking licences
- Commercial bank licence, with international, national or regional authorisation
- Merchant bank licence
- Non-interest bank licence, national or regional; see Islamic finance
- Payment service bank (PSB) licence
Other financial institution licences
- Microfinance bank licence, at unit, state or national level
- Primary mortgage bank licence
- Finance company licence, for regulated lending and leasing businesses
- Development finance institution licence
- Credit bureau licence
Foreign exchange and remittance licences
- Bureau de change (BDC) licence
- International money transfer operator (IMTO) licence
Payment and fintech licences
- Payment solution service provider (PSSP)
- Payment terminal service provider (PTSP)
- Switching and processing
- Mobile money operator
- Super agent
- Payment service holding company
For payment businesses, see our fintech licensing service, which covers payment licences, the CBN regulatory sandbox and open banking in more detail.
Which CBN licence do you need?
The right licence depends on what your business will actually do, not on what it is called. The questions that decide it are:
- Will you take deposits from the public? If so, you need a bank or microfinance bank licence.
- Will you lend from your own funds, or from borrowed or deposited funds?
- Will you hold customer money or only process payments for others?
- Will you deal in foreign currency or send money into or out of Nigeria?
- Will you operate nationwide, in one state or in one location?
Many businesses need more than one licence, or a holding structure that keeps regulated activities in separate companies. We map your model against the CBN's categories and recommend the licence, or combination of licences, with the lowest capital and fastest route that still allows you to do what you plan.
How to get a CBN licence: the process
1. Licence strategy and structure
We confirm the licence category, the minimum capital that currently applies, the shareholding structure and whether any part of the business needs a separate licence or a different regulator.
2. Promoters, board and management
The CBN must be satisfied that the shareholders, directors and senior managers are fit and proper. We prepare the disclosures, identify the ultimate beneficial owners and flag anything that could slow the approval, such as unclear sources of funds or previous regulatory issues.
3. Application for approval-in-principle
We prepare and file the application for approval-in-principle (AIP). It typically includes the business plan and financial projections, evidence of capital, details of promoters and proposed directors, the draft constitutional documents and the required fees.
4. Incorporation and set-up
After the AIP, the company is incorporated or its constitution amended through the Corporate Affairs Commission, the capital is put in place, and the institution builds its offices, technology and policies, including its anti-money laundering, risk, IT security and data protection frameworks.
5. Final licence
We apply for the final licence, prepare the institution for the CBN's pre-licensing inspection and respond to the CBN's requests until the licence is issued.
6. After the licence
Once licensed, the institution must meet continuing obligations: regulatory returns, corporate governance codes, approvals for new directors and shareholders, and compliance with CBN circulars. We advise on these as they arise.
Why CBN licence applications are delayed
Most delays come from problems that could have been fixed before the application was filed:
- Applying for the wrong licence category for the business model
- Capital that is short of the current requirement, or whose source cannot be clearly shown
- Promoters or directors who do not meet the fit and proper criteria
- A business plan that does not match the activities applied for
- Missing or generic policies for AML/CFT, risk, IT and consumer protection
- Foreign shareholders without the documents the CBN expects from them
We review your application against these points before filing, so the CBN receives a complete file the first time.
Foreign investors and international groups
Foreign companies and investors can own and obtain CBN-licensed institutions in Nigeria. We advise foreign banks, fintechs and investors on:
- The Nigerian entity and shareholding structure, and registration with the Nigerian Investment Promotion Commission
- Bringing in capital through the banking system and obtaining a Certificate of Capital Importation
- Documents needed from the home country, including notarised and legalised corporate records and, for regulated groups, a letter of no objection from the home regulator
- Acquiring an existing licensed institution instead of applying for a new licence; see mergers and acquisitions
CBN licence lawyers in Lagos and Abuja
The CBN's head office, where licence applications are decided, is in Abuja. Our Abuja office in Wuse 2 attends to applications and follow-ups with the CBN directly. Our Lagos office in Lekki works with the banks, fintechs and investors based in Lagos, which is where most of Nigeria's financial sector operates.
Changes of control, recapitalisation and compliance
We also advise licensed institutions on:
- CBN approval for acquisitions of significant shareholdings and changes of control, with regulatory due diligence on the target
- Recapitalisation, including rights issues, private placements and mergers
- Upgrades, downgrades and conversions between licence categories
- Approvals for new directors and senior management
- CBN examinations, sanctions and regulatory intervention
Fees
We quote a fixed fee for each CBN licence application once we understand your business model and the licence required. CBN application and licensing fees are paid at cost. You know the full cost of our work before we start.
