Nigeria’s Central Bank has directed commercial banks, fintechs, and other payment service providers in the country to disclose their Ultimate Beneficial Owners, UBO in line with regulatory framework in the sector.
Ultimate Beneficial Ownership (UBO) refers to the real person or persons who ultimately own, control, or benefit from a company, asset, or legal entity, even if their ownership is held indirectly through other companies, trusts, or nominees.
In simple terms, a UBO is the actual human being behind a business or investment, regardless of the complexity in its ownership structure.
The Yemi Cradoso-led CBN latest measures to bank is contained in a circular dated June 15, and signed by CBN’s Director, Payments System Supervision Department, Dr. Rakiya Yusuf.
Banks, fintechs and other digital payment solutions companies are expected to comply fully with the directives by January 1, 2027, the apex bank said.
According to the apex bank, the measure is aimed at promoting transparency, reduce market concentration risks in the country’s payment system, even as analysts insist that the latest measure is a timely intervention by the CBN in its ongoing efforts to restructure the nation’s growing digital payment system.
The measures, analysts also insist comes amid rapid expansion of electronic payments in the country , and increasing dominance of a few players across critical segments in the sector, which has heightened concerns over operational dominance and dependence, ownership transparency among key players in the ecosystem.
According to them, CBN is also trying to use the latest measures to strengthen governance standards in the sector, as well as ensure that the growth in the payment system does not create risks capable of threatening the nation’s financial system, saying recent development in the nation financial sector has revealed “ rapid growth in electronic payments, increasing adoption of digital financial services, and the emergence of operators with substantial market presence across key payment activities.
“While these developments have supported innovation, efficiency, and financial inclusion, they have also raised concerns relating to market concentration, operational dependence, systemic importance, transparency of ownership structures, and the localisation of critical payment data.
“Accordingly, the CBN hereby issues this circular to improve transparency through beneficial ownership disclosure, address concentration risk, promote a fair, competitive, and resilient payments ecosystem.
“The circular further aims to safeguard the integrity of the Nigerian payments system and ensure the localisation of payments transaction data within Nigeria,” the CBN said.
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