Nigeria Payments Service Provider License

Tetra Consultants’ team of licensing experts has years of experience assisting international clients to secure a Nigeria Payments Service Provider License. Our team will ensure that you meet all the mandatory requirements for the license application. Tetra Consultants will guide you throughout the engagement process to meet all the obligations including the deposition of minimum capital.

Company Registration

2 Weeks

Local Director?


Bank Account Opening

4 Weeks

Travel Required?



Based on 87 reviews

    Nigeria Payments Service Provider License 

    • Tetra Consultants assist international clients with securing a Nigeria Payments Service Provider License. The Central Bank of Nigeria (CBN) has stated that digital payment users in Nigeria have increased by 35%. The increasing investment in payment technology infrastructure by banks, telecoms, and fintech businesses is one factor contributing to Nigeria’s booming rate of payment transaction volume and value. As a consequence, many foreign businesses are contemplating participating in the Nigerian payments ecosystem.
    • Local and foreign investors seeking to provide specific payment services in Nigeria must obtain one of the CBN’s specified licenses. As a result, the purpose of this article is to discuss some of Nigeria’s key payment licenses and their allowed and non-permissible activities.
    • Tetra Consultants’ team of licensing experts helps you navigate this jungle and will guide you on what types of licenses are there for payment services in Nigeria, and what type of payment licenses you need according to your business model. Moreover, we provide a wide array of services to our international clients from the formation of a business entity to getting the necessary payment service provider license for its operation in Nigeria.

    What are the laws governing the issuance of a Nigeria Payments Service Provider License?

    • The Nigerian financial technology (fintech) sector has made significant gains in recent years. However, one element that had long perplexed investors and important players in Nigeria was the lack of a clear structure and licensing system for payment services.
    • Multiple regulations and guidelines were being implemented in the sector, making it difficult for industry players to simply identify the relevant type of Nigeria payments service provider licenses that correspond to the operations they want to deliver.
    • The Central Bank of Nigeria (“CBN”) released a Circular on a new license classification for Nigeria’s payments system (“Circular”) on December 9, 2020. It is worth noting that the CBN published an exposure draft on the licensing system for payment service providers in 2018, but no substantive circular was released. The regulatory delay over the last few years has engendered dread and apprehension among current market participants, not to mention potential investors in Nigeria’s payments business. This Circular has undoubtedly provided much-needed clarification on licensing categories for participants and associated minimum capital requirements to all parties involved. It is also extremely encouraging to notice that the formerly high minimum capital levels set forth in the conceptual framework have been considerably decreased for several of the categories.

    What are the categories of Nigeria Payments Service Provider Licenses?

    • The Central Bank of Nigeria (the “CBN”) under the circular for “new license categorization” has created several categories of licenses for businesses wishing to provide payment services in Nigeria, depending on the scope of services which the applicant intends to provide. Therefore, a Nigeria Payments Service Provider License can be categorized as below: 
    • Payment Solutions Service Provider (“PSSP”) License; 
    • Payment Terminal Service Provider (“PTSP”) License; 
    • Payment Solution Service (“PSS”) License; 
    • Mobile Money Operation (“MMO”) License; and 
    • Switching and Processing License

    Other notable provisions in the Payment Systems Circular:

    • In addition to setting out the categories of Nigeria Payments Service Provider Licenses, the CBN also set out some additional matters that fintech needs to be aware of which include the following:
    1. Only MMOs are allowed to keep customer funds: Due to the uncertainties surrounding fintech licensing, holders of various licenses were set up in a way that allowed them to store consumer funds. However, with the implementation of the NPS Circular, it is now evident that other fintech, such as PSSPs, are no longer permitted to retain consumer funds.
    2. Switching companies and MMOs can only function within the framework of a holding company: Combining switching and MMO operations under the same organization is currently illegal for fintech. This is done to avoid the confluence of operations under the same company. They may, however, function as separate subsidiaries under a holding company and must carry out clearly defined activities.
    3. Collaborations between fintech and financial institutions require CBN approval: Fintechs functioning in the payments system must now acquire CBN clearance before collaborating on products and services with other payment businesses, banks, and other financial institutions.
    4. Restriction on permitted activities in the memorandum and articles of association: Payment service providers must now guarantee that the objective clauses in their Memorandum and Articles of Association (MEMART) are confined to the legal operations permitted under their licenses. 
    5. No-objection from CBN: All fintech that has any of the license types covered by the NPS Circular, or plans to gain a new license, must get a no-objection letter from the CBN’s Payments System Management Department.
    6. Compliance expectations for companies: Companies with new licensing requests, as well as those that presently have Approvals-in-Principle from CBN, are required to immediately comply with the provisions of the NPS Circular.

    What are the benefits of obtaining a Nigeria Payments Service Provider License?

    The NPS Circular has implications for fintech and it is expected that there may be some changes in how fintech will be structured over the next few months. Some of these implications include the following:

    • By obtaining a Nigeria Payments Service Provide License, a fintech can carry out a range of activities that could position it as a strong player in the ecosystem.
    • With the loose licensing regime that has existed, some fintech has collaborated with banks in rolling out new products and services and probably circumventing some of the regulatory restrictions that exist under their licenses. However, with the requirement for fintech to seek the approval of the CBN before they can proceed with collaborations, CBN will be able to examine the proposed products and services and determine if they are suitable for the parties to operate with, taking into consideration the provisions of their respective licenses.
    • The launch of the regulatory sandbox means that innovators and fintech can now apply to have their new products and services tested in the sandbox environment.With no share capital restrictions or limitations, it is indicative that start-ups and entrepreneurs would be able to take advantage of this and have their innovations reviewed by the CBN.
    • The permissible services that can be carried out by the different payment businesses are now clearly identified and so this reduces the ambiguity around what sort of activities each fintech can undertake. Furthermore, it is now clear that only MMOs can hold customers’ funds and they are prohibited from setting up in a way that leads to them co-mingling their activities with switching services.
    • The minimum share capital requirement for the different payment systems has been set out in an explicit manner. Consequently, industry participants can determine if they want to recapitalize to acquire additional licenses and meet up with the minimum share capital requirement for the category of Nigeria PSP License they intend to acquire.

    Scope of different types of Nigeria Payments Service Provider Licenses

    Payment Solutions Service Provider (“PSSP”) License

    • A PSSP license is one of the four broad categories of payments system licensing in Nigeria by the CBN via its Circular Ref No. PSM/CIR/GEN/CIR/01/22 dated 9th December 2020. The PSSP license falls under the Payment Solution Services (“PSSs”), which permits holders to engage in payment processing gateway and portals, payment solution/application development, merchant services aggregation, and collections.
    • This broad category comprises Payment Solution Service Providers (PSSPs) Payment Terminal Service Providers (PTSPs) and Super-Agent. An institution looking to secure a PSS license will have to select one or all of the three aforementioned licenses. PSSPs serve to deploy payment gateways through online channels. PTSPs essentially engage in Point of Sale (POS) Terminal deployment, ownership, and services. Super agents, on the other hand, are licensed companies that recruit agents for agency banking. Agency banking involves the provision of financial services within communities on behalf of banks.
    • A PSSP licensee is not permitted to hold customer funds or to engage in e-money issuing, or wallet creation. If a fintech company operating a payments system services intends to do any of the foregoing, then it is required to apply for Mobile Money Operations (MMOs) from CBN and must have been registered with the Corporate Affairs Commission (“CAC”) with paid-up share capital of N2billion (as against the N100million paid up share capital for a PSSP license).

    Payment Terminal Service Provider (“PTSP”) License

    • Payment Terminal Service providers are fintech companies licensed to provide POS terminal deployment, support, and maintenance services. Examples of PTSPs in Nigeria are Interswitch Limited, IntelliFin Solutions Ltd, and Fidesic Nigeria Limited.

    Payment Solution Service (“PSS”) License

    • Payment solution services provide bridging infrastructure, end-to-end electronic payment solutions, systems, and services to stakeholders within the financial services space. Some of the operators that provide payment solution services are usually integrated into card schemes and core banking systems.
    • The NPS Circular provides that anyone who obtains a Payment Solution Services (PSS) Licence would be entitled to carry out the activities of Super Agents, Payment Terminal Service Providers (PTSP), and Payment Solutions Service Providers (PSSPs).

    Mobile Money Operation (“MNO”) License

    • Mobile money is a technology that allows customers to receive, store and spend money using a mobile phone. MMOs develop and deploy financial services through  mobile phones and mobile telephone networks. Some popular MMOs include Opay, Paga, Konga Pay, and Palm Pay.
    • Mobile Money Operators (MMOs) allows users to save, receive and spend money from the convenience of a mobile phone. Permissible activities under this category include wallet creation, electronic money issuing, agent recruitment, non-bank acquiring services, card acquiring services, local and cross-border payments, and remittance services, among others. However, MMOs are not permitted to grant loans, advances, and guarantees, accept foreign currency deposits, deal in the foreign exchange market other than as permitted nor engage in insurance underwriting.
    • The NPS Circular provides that the minimum share capital for MMOs is two billion Naira (N2,000,000,000). MMOs are permitted to issue electronic money (e-money), create and manage wallets, and manage pool accounts. They are also permitted to carry out activities that can be performed with a Super-Agent license.

    Switching and Processing License

    • A switching license is regarded as one of the most valuable licenses a fintech can have in Nigeria. Switching companies facilitate the exchange of value between financial service providers, merchants, customers, and other stakeholders. They route payment transactions between multiple acquirers and payment service providers.
    • The NPS Circular provides that the minimum share capital requirement for a Switching and Processing Company is two billion Naira (N2,000,000,000). The permissible activities for switching companies are;
      • Switching;
      • card processing;
      • transaction clearing and settlement agents services; and
      • non-bank acquiring services.
    • Switching and Processing companies are now permitted to perform the activities covered under the Super-Agent, Payment Terminal Service Provider (PTSP) and Payment Solutions Service Provider (PSSP) licenses.

    What are the activities allowed under different Nigeria Payments Service Provider Licenses? 

    • A Nigeria Payments Service Provider (PSP) License allows you to undertake the following activities: 
    • Super Agents: The permissible activities for Super Agents are agent recruitment, management, and other activities set out in the Regulatory Framework for Licensing Super Agents in Nigeria.
    • MMOs: Permissible activities for MMOs are the issuance of e-money, wallet creation, and management, and pool account management. They are also permitted to carry on all the activities of a Super Agent, in addition.
    • PTSPs: The permissible activities for a PTSP licensee are POS terminal deployment and services, POS terminal ownership, Payment Terminal Application Developer (PTAD), merchant/agent training, and support.
    • PSSPs: PSSPs can engage in payment processing gateway and portals, development of payment solutions/application, and merchant service aggregation and collections services.
    • Switching and Processing: Switch Cos is authorized to engage in switching, processing of cards, clearing transactions /settlement agents, non-bank acquiring services, and the listed activities for SuperAgent, PTSP, and PSSP.

    What are the regulatory and informational requirements for obtaining a Nigeria Payments Service Provider License?

    Requirements for the formation of a company in Nigeria: 

    Upon receipt of your instructions to proceed with the company registration, we will require you to furnish us with the information set out below. 

    • Two proposed names of the company
    • The proposed registered address of the company 
    • Concise details of the nature of the business
    • The share capital of the company (depending on the type of payment service provider license to be applied for)
    • At least two directors with a mix of at least one executive director (who is a resident of Nigeria) and who are competent in the relevant field and sector to pass the fit and proper test. Tetra Consultants team can assist by providing nominee director services. 
    • At least two shareholders (Individual/company)
    • A company secretary/resident agent
    • The full names, contact addresses, email addresses, phone numbers, date of birth, occupations, and electronic signature of the shareholders, and the distribution of the shares between the subscribers
    • Where a company is a shareholder: a copy of the incorporation certificate of the company; board resolution of the company approving the acquisition of shares and appointing its representative; and the electronic signature of the representative
    • The full names, contact addresses, email addresses, phone numbers, date of birth, occupations, and electronic signature of the initial directors (at least two) of the company
    • Copies of government-issued identity cards or the bio-data page of the passport of the proposed directors and shareholders.

    Capital requirements:

    • The Central Bank of Nigeria on the 21st of May, 2021 issued new license requirements for the payments system in Nigeria. 
    • The New Licence requirements highlight the capital requirements, documentary requirements, application and licensing fees, and license validity for each category. The categories for which requirements are listed under the circular include:
    1. Switching and processing license: To be eligible for the license, there is a capital requirement of two billion Naira (N2,000,000,000) (shareholders’ funds unimpaired by losses) and an escrow of refundable Two billion Naira (N2,000,000,000) deposited into CBN PSP Share Capital Deposit Account. The escrow must be paid as a lump sum. The validity of the license is determined by the CBN upon satisfactory performance of operations.
    2. Mobile Money Operation (MMO): The Circular requires all Mobile Money Operators (“MMO”) to maintain two billion Naira (N2,000,000,000) shareholders’ funds unimpaired by losses. The CBN also prescribes that prospective MMO licensees make a refundable deposit of N2,000,000,000 (Two Billion Naira) into an escrow account created for that purpose and the escrowed funds can be invested into treasury bills, subject to the availability of treasury instruments.
    3. Payment Solution Service (PSS): The capital requirements are as follows: two hundred and fifty million Naira (N250,000,000) (shareholders’ funds unimpaired by losses) and an escrow of refundable two hundred and fifty million Naira (N250,000,000) paid into the CBN PSP Share Capital Deposit Account Number. The escrow is to be paid in one lump sum.
    4. Payment Terminal Service Provider (PTSP): The capital requirement if of one hundred million Naira (N100,000,000) (shareholders’ funds unimpaired by losses) and an Escrow of refundable one hundred million Naira (N100,000,000) deposited into CBN PSP Share Capital Deposit Account Number in a lump sum.
    5. Payment Solution Service Provider (PSSP): The capital requirements, application fees are the same as the requirements highlighted for Payment Terminal Service Provider. The validity of this license is determined by the Central Bank of Nigeria and renewable upon satisfactory performance of operations.

    Nigeria Payments Service Provider License Application and Requirements:

    • The application letter for the PSSP license is to be addressed to the Director, Payments System Management Department (“PSMD”), Central Bank of Nigeria and accompanied by the following:
    • Incorporation documents: The following documents, which are to be certified by the Corporate Affairs Commission (“CAC”):
      • Certificate of incorporation;
      • Memorandum and Articles of Association (“MEMART”). Please note that the object clause in the MEMART will be limited to the permissible activity of the relevant license type;
      • CAC Form for Return of Allotment of Shares showing the paid-up share capital of the company; and
      • CAC Form for Particulars of Directors.
    • Financial related documents: The following documents must be presented (in case the company is already in existence):
      • Audited financial statement of the applicant company;
      • Statement of paid-up capital and plan for future increase;
      • Proof of payment of the shareholders’ (Escrow) fund of the respective minimum capital (in one lump sum and in the company’s name) into CBN Share Capital Deposit Account. This deposition of share capital is refundable and may be invested pending approval/grant of final license. 
      • Proof of payment in the applicant’s name of a non-refundable application fee of N100,000 to CBN Please note that after the grant of the Approval-In-Principle, the applicant company will be required to pay the Licensing Fee of N1,000,000 before the issuance of the final license.
    • Business-related documents: The other documents include:
    • The Company’s profile detailing whether it is a private or public limited liability company; the current business operations, products, and services; holding or parent company (if any); details of ownership and name(s) of the person(s) with significant control (if any) or any significant changes in ownership in the last two (2) years; the total number of staff; functional address including email address(es) and phone number(s); and proof of at least one non-executive director on the company’s board.
      • Proposed Business Plan detailing the nature of business, features of the scheme, security features to be put in place, three (3) years’ financial projections; details of transactions and applicable charges that will be borne by users/customers; profit-sharing agreement between or amongst the partners; and diagrammatic illustration of transaction flows.
      • Different risk management policies and information technology policies of the company must include the following:
    1. Privacy Policy
    2. Information Ownership/Disclosure/Loss Policy
    3. Backup and Restore Policy
    4. Network Security Policy
    5. Encryption Policy
    6. Confidential Data Policy
    7. Password Policy
    8. Third Party Connection Policy
    9. Incidence Response Policy
    10. Physical Security Policy
    • Enterprise Risk Management Framework.
    • Dispute Resolution Framework/Service Level Agreement.
    • Contingency and Disaster Recovery Plan (Business Continuity Programme).
    • Draft Agreements (if any) with (a) Technical Partners, (b) Participating banks, and (c) Any other party or partner.
    • Tax Identification Number (TIN) and the Tax Clearance Certificate (TCC) for the last three (3) years of the applicant company.
    • Personal details of directors and top management team: The directors (including non-executive directors) and top management must provide their respective Bank Verification Number (BVN), signed curriculum vitae, and photocopy of their means of identity (preferably International Passport).

    How to apply for a Nigeria Payments Service Provider License?

    • Tetra Consultants will assist our international clients to register a Nigerian company by providing a local company address, local nominee director, and local company secretary with the Nigeria Corporate Affairs Commission (CAC). This process will take approximately 2 weeks.
    • After the company is registered, Tetra Consultants will proceed to open a corporate bank account with a reputable Nigerian bank. This bank account will be used to deposit the minimum paid-up capital required to the CBN Escrow account to secure Nigeria Payments Service Provider (PSP) License from the Central Bank of Nigeria (CBN). In 4 weeks, Tetra Consultants will secure the bank account and internet banking token for our international clients.
    • At the same time, Tetra Consultants will assist our international clients to prepare a comprehensive business plan and AML/CFT (anti-money laundering and countering the financing of terrorism) policies required for the license application.
    • Some of these required documents include technology risk management, cyber hygiene, regulatory reporting, penetration testing, and other policies. This is to ensure the company adheres to the compliance, technology risk, and audit requirements regulated by the CBN.
    • Tetra Consultants will source a physical office for our international clients. Our legal team will prepare a lease agreement as per local real estate regulations, to be signed by all parties. Thereafter, our international clients are required to pay monthly rent directly to the landlord.
    • Tetra Consultants can meet the requirement of having at least one resident director through our nominee director services. If required, our team can further assist in the recruitment of a local executive director for your company. Our services include conducting initial screening and interviews as well as preparing employment contracts as per Nigerian employment regulations. Our international clients are only required to attend the final interview to pick the preferred candidate. Thereafter, monthly salaries are to be paid directly to your employee. If required, Tetra Consultants will assist with the recruitment of a Compliance Officer, Chief Technology Officer, and Chief Information Security Officer for you.
    • Once the above is completed, Tetra Consultants will submit the license application to CBN for approval. All going well, we expect to receive in-principle approval within 2 to 3 months upon submission. In the event additional documents are required, Tetra Consultants will immediately prepare the same for submission so as to prevent any engagement delay.
    • In total, Tetra Consultants expects to register your Nigerian company, open a local corporate bank account, and secure Nigeria Payments Service Provider License. 

    How long does it take to obtain a Nigeria Payments Service Provider License?

    • With everything in place, all required documents and payments must be made at the time of application, except the license fee of N1,000,000 which is payable after the grant of the AIP. Upon submission of the application, the applicant company will be scheduled for presentation, after which a team of CBN staff will visit to conduct a pre-license audit at the applicant’s business address. Thereafter an Approval-In-Principle (AIP) may be issued by the CBN.
    • The timeline for the grant of the AIP is usually dependent on some factors, namely: the completeness and compliance of the applicant’s documents with the CBN guidelines, the promptness in responding to CBN’s queries (if any), and how soon the Committee of Governors (COG), the approval authority acting for the CBN Governor, is able to meet and attend to PSMD’s request for the AIP. The AIP is usually granted between 2 to 3 months after the filing of the application which further will be valid for a period of no later than 6 months.
    • The AIP does not entitle the applicant company to commence business operations but to test run, connect to necessary organizations, put necessary security features, and verify the functional challenges of the payment solution platform. When the applicant company is ready to go live, the CBN team will return to assess the readiness of the applicant and to recommend any adjustments or changes, where necessary. If the CBN team is satisfied with the outcome of the visit and the applicant pays the license fee of N1,000,000, the CBN may issue the Final License. The timeline for the issuance of the final Nigeria Payments Service Provider License is usually 6 to 8 months from the date of filing of the license application.

    How much does it cost to obtain a Nigeria Payments Service Provider License?

    • The standard one-time application fee for all the types of Nigeria payments service provider licenses is one hundred thousand Naira (N100,000) and licensing fee of one million Naira (N1,000,000) is paid at the time of issuance of the final license. 
    • While the total engagement fee for acquiring a Nigeria Payments Service Provider (PSP) License depends on the services you need from Tetra Consultants. We provide you with multiple services ranging from assisting you through the incorporation process to obtaining the relevant payment license. This total fee that will be charged will be inclusive of the company registration fee, license fee, and any additional cost that may arise.
    • We will discuss with you the total engagement fee charged in detail before we begin the registration process so that you have a better understanding of what you are paying for.

    Our services

    • Applying for a Nigeria Payments Service Provider (PSP) License can be a daunting process if you are unaware of the laws and regulations governing such licenses in Nigeria. Tetra Consultants provide a seamless experience of applying for a Nigeria PSP license so that you can channel your energy into other important aspects of your business. 
    • Our licensing consultants are experts in the field and ensure a high level of professionalism throughout the whole course of engagements from the formation of an entity in the proposed jurisdiction to the ultimate negotiation and liaison with the regulatory and governmental authorities in order to successfully secure the license. 
    • Tetra Consultants also specializes in providing support with the attainment of other offshore financial licenses

    Find out more!

    Contact us to find out more about how to secure a Nigeria PSP License. Our team of experts will revert within the next 24 hours.


    How can I get a PSSP license in Nigeria?

    • To get any type of Nigeria payments service provider license you will first need to set up an entity in Nigeria according to your business goal and the licensing requirements with the Corporate Affairs Commission. Once registered, you will be required to deposit the required minimum capital amount and apply for a Nigeria PSP with the relevant documents to CBN.
    • Tetra Consultants is proficient in providing assistance to our international clients in obtaining payment licenses. We make sure that our clients get the approval and payment licenses in a shorter period of time while taking care of all the regulatory requirements and preparation of documents.

    Can you apply for a Nigeria payments service provider license online?

    • Tetra Consultants ensures that the process of applying for a Nigeria payments service provider license can be carried out remotely or with minimal travel solutions.

    What are payment service providers in Nigeria?

    • A payment service provider (PSP) is a third-party organization that offers payment services to businesses that accept online payment methods. Credit cards, debit cards, e-wallets, cash cards, bank transfers, and other payment methods may be used.

      Follow us on


      22 Sin Ming Lane #06-76 Midview City, Singapore 573969

      ©2010-2024 Tetra Global Consultants. All rights reserved.