The Corporate Affairs Commission (CAC) issued an important notice with the vow to commence shutting down Point of Sales (PoS) businesses that have failed to register their businesses as its September 5 deadline expired.
In a statement released on Friday, the CAC expressed concerns over inadequate compliance with the directive, despite the large number of PoS operators in the country.
However, CAC commended operators who have taken steps to formalize their businesses, praising their “positive attitudes” towards compliance.
The Commission noted with concern the significant number of operators who have not adhered to the directive.
The statement read, “Recalcitrant operators have refused to adhere to the advice for formalization due possibly to engagements in unwholesome activities or for some reasons best known to them.”
The CAC emphasised that it is working in collaboration with law enforcement agencies and other relevant stakeholders to implement a comprehensive enforcement and sanction framework.
The measures may include the shutdown of non-compliant businesses and other severe legal consequences.
“We are to make it clear that the Commission is working with Law Enforcement Agencies and other relevant stakeholders to deploy comprehensive enforcement and sanction framework that may include not only possible shutdown but other severe legal consequences,” the statement read.
Earlier in May, the CAC announced that PoS agents of major fintechs in Nigeria including OPay, Palmpay, and Moniepoint, among others, had been given a deadline of July 7, 2024, to register their business.
The Commission later extended the deadline by 60 days to September 5, 2024. The extension came with a warning that any operator that failed to meet the new deadline would face prosecution and risk losing the business.
This directive was issued in response to a rise in fraud incidents involving POS terminals and CBN’s plans to prohibit trading in cryptocurrencies and other virtual currencies.
A report from the Nigeria Inter-Bank Settlement System Plc revealed that POS terminals were involved in 26.37 per cent of fraud incidents in 2023.
The CAC stated that the registration initiative aims to reduce fraud within the system, as well as combat kidnapping and the payment of ransoms
Meanwhile, the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN) has taken legal action against the CAC.
AMMBAN insisted that the registration requirements imposed by CAC violated the provision of the Companies and Allied Matters Act, Laws of the Federation of Nigeria, 2004, which “explicitly states that the commission has no jurisdiction over individuals not operating as a company.
According to the national general secretary of AMMBAN, Oluwasegun Elegbede, the matter is already in court and the court has scheduled this September for hearing.
“The court will have to intervene in the interpretation of the quoted section of the CAMA if individuals operating as a sub-agent (likened to a bank branch) must register with CAC,” Elegbede added
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