The Registrar-general of the Corporate Affairs Commission (CAC), Hussaini Magaji, has disclosed that 100,000 Point of Sale (PoS) operators have registered their businesses with the commission under its PoS formalisation project.
The project, which was launched on July 7, 2024, was concluded on September 5, 2024.
Magaji who disclosed this during an In-House Enforcement and Compliance Training for state offices, held in Abuja, said the current number of registrations is a significant shortfall compared to the 250,000 registrations that were expected from the initiative.
The training, tagged “Re-engineering the commission for effective discharge of compliance and enforcement mandates to ensure efficient management of corporate vehicles”, drew participants from all the states of the federation.
According to the Nigeria Inter-Bank Settlement System (NIBSS), there are over 1.9 million PoS terminals deployed by merchants and individuals nationwide.
The CAC stated that the registration initiative aims to reduce fraud within the system, as well as combat kidnapping and the payment of ransoms.
The Registrar-general said while some fintechs appreciated the transformative nature of modern business which requires formal documentation as an essential first step, others with archaic mentally became fixated on the old and obsolete informal mode of business operations.
“The drive for rigorous Compliance and Enforcement functions, you would have noticed commenced with the POS Formalization Project under which POS Operators were required to register a minimum of Business Name in line with the requirements of section 863 (1) of CAMA which require prior registration before commencement of business or at most within 28 days of commencement for Business Names. “Some of the Fintech Companies on which platforms the POS operators do business saw the wisdom and the benefits that could accrue to the businesses themselves and the nation at large.”
Continuing, Magaji said “While the visionary Fintechs mentioned above and their operators appreciated the transformative nature of modern business which requires formal documentation as an essential first step, others with archaic mentally became fixated on the old and obsolete informal mode of business operations sometimes with cash kept under a pillow or in jute bags.
“The commission has to date registered about 100,000 POS operators under the POS formalization project. This is a far cry from the 250,000 expected from that sector alone. Apart from the Fintech sector, it is estimated that about 40 million micro, small and medium enterprises are operating in the economy. A realistic objective is to get 50 per cent formalisation of this figure.”
He further stated that the commission is working with other regulators to develop appropriate sanctions or responses to recalcitrant operators that have refused to heed the advice for formalisation.
He, however, warned that “The risk of engaging in business transactions with unregistered businesses is very high. Such business is not only susceptible to disappearance into thin air without trace but also serves as an easy vehicle for money laundering and terrorism financing. Unregistered businesses also cannot access government interventions in any sector. Consequently, formalisation is the first step for the legitimate commencement of modern business.
“There is however a window for regularisation between now and when the regulatory hammer will be brought on them. We are to also clarify that multiple registration is not required across each Fintech for each POS operator.”
