On January 31, 2024, the Central Bank of Nigeria (CBN) introduced two important policies related to foreign currency remittances. Namely, the new Guidelines for the Operation of International Money Transfer Services in Nigeria (IMTO Guidelines) and the circular on the Removal of Allowable Limit of Exchange Rate Quoted by the International Money Transfer Operators (IMTOs). The purpose of this was to mitigate the problems associated with exchange rate fluctuations.

Entities holding an IMTO license Nigeria are empowered by the CBN to manage the transfer of funds from overseas to Nigerian recipients efficiently. The New IMTO Guidelines, updating the initial 2014 version, detail the regulatory framework for IMTOs, specifying allowed activities, organizational structure, and corporate governance requirements.

Furthermore, a September 13, 2023, CBN circular previously mandated IMTOs to set exchange rates for diaspora remittance payouts within a specified range. The recent Permissible Limit Circular permits IMTOs to make payments at the current market exchange rate. By introducing significant regulatory changes and operational standards, these updates significantly impact the operations of the IMTOs, especially in the financial services sector and fintech companies.

Benefits of an IMTO License Nigeria

Increased confidence

Positioning the operator as a recognized entity in the industry, as the IMTO license enhances the legitimacy of the operator, contributing to the building of trust among customers, financial partners, and regulators.

Access to banking networks

Establishment of partnerships with banks and other financial institutions for the efficient execution of cross-border transactions due to the integration of license holders into the formal financial ecosystem of Nigeria.

Market expansion

Tapping into Nigeria’s sizable remittance sector opens the door to new business and revenue opportunities in a market important to many families.

Compliance with regulatory requirements

Minimize the risk of sanctions or legal issues while promoting operational transparency and accountability, as a license ensures that operators meet regulatory standards.

Increased consumer confidence

Customer confidence in the security and reliability of their transactions by dealing with a regulated and officially authorized service provider.

Regulatory Framework for IMTO License in Nigeria

The regulatory landscape for operators holding an IMTO license Nigeria is governed by key legislations and directives from the Central Bank of Nigeria (CBN):

  • Central Bank of Nigeria Act 2007
  • Bank and Other Financial Institutions Act (BOFIA) 2004
  • CBN Guidelines for International Money Transfer Services in Nigeria 2014
  • Additionally, various CBN regulations and circulars further define the operational and compliance requirements for International Money Transfer Services in Nigeria

Permissible and Non-Permissible Activities

An IMTO license Nigeria enables the holder to engage in specific, regulated activities, primarily focusing on inbound money transfers. These operations must adhere to the guidelines set by the Central Bank of Nigeria (CBN).

Permissible Activities

  1. Accepting funds for the purpose of transferring to individuals within Nigeria.
  2. Providing cross-border personal money transfer services for:
  • Family maintenance.
  • Services benefiting foreign tourists in Nigeria.
  1. Targeting individual customers for transactions that are:
  • Person to person.
  • Business to person.
  • Business to business.

It’s important to note the CBN’s January 2024 mandate prohibiting IMTOs from processing outbound payments.

Non-Permissible Activities

An IMTO license holder is restricted from:

  • Acting as an authorized dealer in gold or other precious metals.
  • Deposit-taking or lending money.
  • Maintaining current accounts for customers.
  • Establishing letters of credit.
  • Acting as a custodian of funds.
  • Engaging in institutional transfers.
  • Buying foreign exchange from the domestic market for settlement.

Requirements and Regulations for IMTO in Nigeria

For an International Money Transfer Service (IMTS) provider in Nigeria, a mandatory share capital of $1,000,000 (One Million US Dollars) is required for both foreign and Nigerian entities. The Central Bank of Nigeria (CBN) mandates this deposit into a designated CBN account as proof of the promoters’ commitment, refundable upon IMTO license issuance.

IMTO License Nigeria Incorporation Requirements

An IMTO must first obtain “Approval-In-Principle” (AIP) from the CBN before the CAC (Corporate Affairs Commission) will incorporate it.

Incorporation Requirements

  1. Two proposed names for CAC approval leading to CBN AIP.
  2. Registered address and contact information, including email and phone number.
  3. Shareholders, directors, and company secretary information, including contact details, occupation, National
  4. Identification Number (NIN) or international passport for foreigners, and electronic signatures.
  5. You must specify the operation as an International Money Transfer Service company.

Post-Incorporation Regulatory Registrations

After incorporation, an IMTO company in Nigeria must secure:

IMTO License Nigeria Registration

To operate as an International Money Transfer Operator (IMTO) in Nigeria, entities must secure an IMTO license from the Central Bank of Nigeria (CBN), specifically through its Trade and Exchange Department. The process involves a comprehensive list of requirements aimed at ensuring compliance and operational integrity.

IMTO License Nigeria Guide

  1. Details of Authorized Dealer Bank(s) to act as local agents, including agency agreements.
  2. A copy of the certificate of incorporation.
  3. Certified true copies of the Memorandum & Articles of Association, highlighting money transfer services as a primary objective.
  4. Details on the company’s shareholding structure.
  5. Corporate Affairs Commission (CAC) forms — displaying shareholdings and information about directors.
  6. Information on beneficial owners, where applicable.
  7. Board and management profiles, including resumes, contacts, ownership and management structure.
  8. An organogram of the company.
  9. Business plan, including the nature of the business, internal controls, security measures, financial projections, market analysis, transaction costs, profit distribution, transaction patterns, and customer dispute resolution mechanisms.
  10. IT and security policies, including privacy, data management, network security, encryption, and risk management.
  11. Business continuity and disaster recovery strategies.
  12. Partnership agreements — projects with participants.
  13. Three-year certificates of no tax liabilities.
  14. Credit reports for shareholders and key officials from a licensed credit bureau.
  15. Proof of minimum paid-up capital ($1,000,000) or non-refundable application fee (N10,000,000).
  16. Operating in at least seven different countries and having authorizations or agency agreements in those jurisdictions.

Sanctions for Non-Compliance with CBN Guidelines

  1. Corporate Approvals: The CBN may withhold any pending approvals.
  2. Financial Penalties: Impose fines on the IMTO.
  3. Suspension: Temporarily halt the IMTO’s operations.
  4. License Revocation: Permanently revoke the IMTO’s license to operate.

Incorporation and Licensing Costs for an IMTO in Nigeria

  1. CAC Registration — approximately N22,000,000.
  2. CBN Registration — N10,000,000 (Non-refundable application fee).
  3. Miscellaneous Costs — detailed upon request.
  4. Professional Fees — specified upon inquiry.


How does a company become an IMTO in Nigeria?

First, a company must obtain an IMTO license from the Central Bank of Nigeria (CBN). This permit allows activities such as transferring funds to Nigeria, providing inbound remittance services, and focusing on transactions with individual clients. It prohibits activities such as trading in precious metals, money lending, and the purchase of foreign currency for settlement purposes.

What is the required authorized capital to open an international money transfer service in Nigeria?

An international money transfer service in Nigeria must deposit N1,000,000 (one million US dollars) as authorized capital with the CBN, which applies to both local and foreign companies. This amount is refundable upon approval of the IMTO license.

What steps are needed to incorporate an International Money Transfer Service company in Nigeria?

To incorporate, an IMTO must first obtain a CBN “Approval-In-Principle” (AIP). Essential steps include submitting company names for approval, detailing shareholders and directors, and ensuring the company aims to provide international money transfer services.

What registrations are needed after incorporating an IMTO in Nigeria?

After incorporation, an IMTO must register with the Federal Inland Revenue Service (FIRS), Special Control Unit against Money Laundering (SCUML), and the Central Bank of Nigeria (CBN) to comply with legal and regulatory frameworks and start operations.

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