CAC Moves to Shut Down Unregistered PoS Businesses as Deadline Lapses
The Corporate Affairs Commission (CAC) has announced plans to take drastic measures, including shutting down Point of Sale (PoS) businesses that have failed to comply with its mandatory registration directive.
This follows the expiration of a 60-day registration deadline on September 5, 2024.
In a public notice issued on Friday, the CAC stated that there was inadequate compliance with its directive and warned that operators who failed to register might be involved in “unwholesome activities.”
The commission emphasized its commitment to work with law enforcement agencies and other stakeholders to implement a comprehensive enforcement and sanction framework, which could include business shutdowns and severe legal consequences.
“The Corporate Affairs Commission wishes to remind the general public, particularly Fintech operators also known as Point of Sale (POS) operators, that the 60-day deadline…for the registration of such businesses expired on September 5, 2024,” the notice read.
The commission commended those who had complied but criticized those who had not, suggesting that their refusal could be due to involvement in improper activities.
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This development comes amid opposition from fintech business owners under the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN), who have challenged the CAC’s registration requirement in court, describing it as illegal.
AMMBAN maintains that the directive violates the Companies and Allied Matters Act (CAMA), which states that the CAC has no jurisdiction over individuals not operating as a company.
The association’s General Secretary, Oluwasegun Elegbede, stated that the case is already in court and is set for hearing in September.
Earlier in May, the CAC had mandated that PoS agents of major fintech companies, including OPay, Palmpay, and Moniepoint, register their businesses by July 7, 2024.
The deadline was later extended to September 5, 2024, with a warning that non-compliance would lead to prosecution and potential business closures.The directive comes amid concerns about rising fraud involving PoS terminals and the Central Bank of Nigeria’s (CBN) efforts to regulate cryptocurrency transactions.
According to the Nigeria Inter-Bank Settlement System (NIBSS) Plc, PoS terminals accounted for 26.37% of fraud incidents in 2023.
CAC’s Registrar-General, Hussaini Magaji, defended the registration requirement, citing Section 863, Subsection 1 of the Companies and Allied Matters Act (CAMA) 2020 and the 2013 CBN guidelines on agent banking.
He argued that the move is aimed at safeguarding fintech businesses and customers while strengthening the economy.
As the court prepares to hear the case, the CAC remains resolute in its enforcement strategy, with potential business shutdowns looming for non-compliant operators.
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