In a move highlighting the ongoing tension between regulatory directives and business freedom, point-of-sale (PoS) operators in Nigeria are preparing to take legal action against the Corporate Affairs Commission (CAC). The dispute centers around the CAC’s recent mandate requiring all PoS operators to register their businesses by July 2024, a directive that has caused significant dissent within the sector.
PoS operators argue that the Companies and Allied Matters Act (CAMA) 2020 does not grant the CAC authority over individual agents operating under their own names. They cite Section 863 (1) of CAMA, which they interpret as exempting individuals from mandatory registration with the CAC.
The Association of Mobile Money and Bank Agents in Nigeria (AMMAN) has been vocal in opposing the mandate. AMMAN’s national general secretary, Elegbede Oluwaseun, has stated that the CAC does not have jurisdiction over individuals who are not operating as companies. He argues that the policy contradicts the Central Bank of Nigeria’s (CBN) 2013 directives on agent banking.
This impending legal battle is not just about regulatory compliance; it’s about the survival of thousands of PoS operators who fear that the CAC’s directive could disrupt their businesses. The registration requirement is viewed as an unnecessary bureaucratic hurdle that could hinder business operations and stifle the entrepreneurial spirit that has fueled the growth of the PoS market in recent years.
Additionally, PoS operators believe that the CAC’s directive could negatively impact financial inclusion efforts in Nigeria. PoS services have played a crucial role in extending financial services to underserved and unbanked populations, especially in rural areas. Any disruption to this service could have significant implications for the country’s financial landscape.
The CAC argues that the registration requirement is in line with CAMA 2020 and aims to protect the interests of fintech companies and their customers. The commission believes that registration will help curb fraud and enhance regulatory oversight, a stance that has some support within the financial technology sector.
As the July deadline approaches, PoS operators are mobilizing resources, rallying support, and preparing their legal arguments to challenge the CAC’s directive in court. The outcome of this legal battle could set a precedent for the regulation of the growing fintech sector in Nigeria and beyond.
PoS operators remain determined to fight for their right to operate without what they see as undue interference. As the legal proceedings unfold, all eyes will be on the courts to see how this critical issue in Nigeria’s fintech industry will be resolved.