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PROCEDURE FOR FINANCE COMPANY LICENSE IN NIGERIA

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INTRODUCTION

The Central Bank of Nigeria according to the powers conferred on it by Section 28 of the Central Bank of Nigeria Act and Section 56-61 of the Bank and Other Financial Institutions Act, issued revised guidelines to regulate the establishment, operations, and other activities of Finance Companies in 2014.

FINANCE COMPANY

A finance company, unless otherwise stated, means a person or company licensed to carry on finance company business. Finance Company Business means the business of providing financial services for consumers and to industrial, commercial, or agricultural enterprises. Such services include:

1.      Funds management;

2.      Equipment leasing;

3.      Hire-purchase;

4.      Debts factoring and securitization;

5.      Project financing or consultancy;

6.      Debt administration;

7.      LPO financing;

8.      Project financing;

9.      Export financing;

10.     Financial consultancy; and

11.     Issuing of vouchers, coupons, credit cards, and token stamps and such other businesses as the CBN may, from time to time, designate.

PROCEDURE FOR APPLICATION FOR LICENCE

Any person seeking a licence for a finance company business in Nigeria shall apply in writing to the Governor of the Central Bank of Nigeria. Such application shall be accompanied by the following:

1.      A non-refundable application fee of N10,000.00 [ten thousand Naira only] in bank draft, payable to the Central Bank of Nigeria.

2.      Deposit of the minimum capital of N20 million (Twenty million naira only) in bank draft made payable to the CBN. The capital thus deposited together with the accrued interest will be released to the promoters on the grant of the final licence.

3.      Satisfactory, verifiable, and acceptable evidence of payment by the proposed shareholders of the minimum capital of N20 million.

4.      A copy of a detailed feasibility report disclosing information that will include:

i.       The objectives and aims of the proposed finance company.

ii.      The need for the services of the finance company.

iii.     The special services that the finance company intends to provide.

iv.      The branch expansion programme [if any] within the first five years.

v.      The proposed training programme for staff and management succession.

vi.      A five-year financial projection for the operation of the finance company, indicating its expected growth and profitability.

vii.     Details of the assumptions upon which the financial projection has been made.

viii.    The organizational structure of the finance company, setting out in detail, the functions and responsibilities of the top management team.

ix.      The composition of the Board of Directors and the curriculum vitae of each member including other directorships held [if any].

x.      The conclusions based on the assumptions made in the feasibility report.

5.      A copy of the draft Memorandum and Articles of Association.

6.      A letter of intent to subscribe to the finance company, signed by each subscriber.

7.      A copy of the list of proposed shareholders in tabular form, showing their business and residential addresses [not post office addresses], and the names and addresses of their bankers.

8.      Names and curriculum vitae (CV) of the proposed members of the Board of directors. The Cvs must be personally signed and dated. The documents/items under paragraph (d) above.

9.      No proposed finance company shall incorporate/register its name with the Corporate Affairs Commission until written approval has been communicated to the promoters by the CBN, a copy of which shall be presented to the Corporate Affairs Commission.

10.     In considering an application for a licence, the Bank shall require to be satisfied as to the following;

  • The Minimum paid-up capital of N20 million is acceptable and the source is verifiable, satisfactory, and acceptable.
  • The quality of the management of the proposed company. The promoters would be required to submit the names and curriculum vita (cv) of the proposed top management team. The CVs must be personally signed and dated.
  • The earnings prospect of the company.
  • The objects of the company as disclosed in its Memorandum and Articles of Association which should agree with the services listed in the provisions of Section 1 of these Revised Guidelines.

11.     Thereafter, the Governor may grant a licence to a finance company.

12.     The CBN may at any time vary or revoke any conditions of a licence or impose additional conditions.

13.     Where a licence is granted subject to conditions, the finance company shall comply with those conditions to the satisfaction of the CBN within such a period as the CBN may deem appropriate in the circumstances.

REQUIREMENTS FOR DIRECTORS

1.      The maximum number of directors on the Board of a finance company shall be seven while the minimum shall be three. To qualify for the position of a director in a finance company, it is hereby required that the person(s) must not be current employees or directors of banks or other financial institutions, except the finance company is promoted by the banks or other financial institutions and are representing the interest of such institutions. In circumstances, however, where current directors or employees of banks or Other financial institutions are proposed for the position of Director, the consent of their employers must be given in writing to the CBN.

2.      The appointment of new directors must be preceded by CBN’s approval.

MANAGEMENT REQUIREMENTS

The following minimum qualifications and experience are mandatory for officers who may occupy the key/top management positions in the finance company.

1.      Managing Director/Chief Executive – a recognized university degree or professional qualification with at least 7 years of post-qualification experience in relevant fields.

2.      Departmental Head – a recognized university degree or professional qualification with at least 5 years of post-qualification experience in relevant fields.

3.      Support staff – shall be qualified and be of proven ability.

4.      A person with any other qualifications or experience that may be considered adequate by the CBN can hold any of the positions [i], [ii] and [iii] within the organization.

CONDITIONS PRECEDENT TO THE COMMENCEMENT OF OPERATIONS

1.      The promoters of a finance company shall submit the following documents to the CBN before such finance company is permitted to commence operations:

a.       A copy of the shareholders’ register in which the equity interest of each shareholder is properly reflected [together with the original for sighting].

b.      A copy of the share certificate issued to each shareholder.

c.       A certified true copy of Form C02 [Return of Allotments] filed with the Corporate Affairs Commission.

d.      A certified true copy of Form C07 [Particulars of Directors] and written confirmation that the Board of Directors approved by the CBN has been installed.

e.       A certified true copy of the Memorandum and Articles of Association filed with the Corporate Affairs Commission.

f.       The opening statement of affairs audited by an approved firm of accountants practising in Nigeria.

g.      A certified true copy of the certificate of incorporation of the company [together with the original for sighting purposes only].

h.      A copy of each of the letters of offer and acceptance of employment by management staff and a written confirmation that the Management team approved by the CBN has been put in place.

i.       A letter of undertaking to comply with all the rules and regulations guiding the operations of finance companies.

j.       Evidence of registration with the finance company’s association umbrella body.

2.      The finance company shall inform the CBN of the location and address of its Head Office.

3.      The finance company shall be informed in writing by the CBN that it may commence business after physical inspection of its premises.

4.      The finance company shall inform the CBN in writing of the date of commencement of business.

CONCLUSION

To recapitulate, it is compulsory for every company desiring to be licensed as a finance company to be a stand-alone and therefore, be strictly limited to solely engaging in finance company businesses as stated in the body of the article.

Breaking:  Kaduna state Governor Recovered And Tested Covid-19 Negative

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Report coming from Kaduna confirmed to us that the Kaduna state governor has disclosed his health status this Wednesday in Kaduna.

 

Below statements comes from the official facebook page of the executive governor malam Nasir el’rufai.

 

 

KADUNA UPDATE: Statement on My Recovery from Covid-19

 

 

In the evening of Saturday, 28 March 2020, I was notified that I had tested positive for Covid-19. I immediately made a public disclosure of this sad news and proceeded into isolation under the strict supervision of our healthcare professionals.

I am delighted to report today, that after nearly four weeks of observing a strict medical regime, I have now received the all-clear after two consecutive negative test results.

I thank Almighty Allah for His grace and mercy. I also acknowledge with gratitude the massive outpouring of sympathy, prayers and public support that followed the disclosure of the infection. My family not only went through the trauma of potentially losing a member, but also the risk of being infected as well. The entire family has been supportive as usual, while my many friends and colleagues from all over the world have sent their prayers and best wishes.

 

 

I wish to thank the diligent medical personnel of our Ministry of Health and the Barau Dikko Teaching Hospital who managed my case for their dedicated and professional care.

It was cheering to see the determined efforts of our Covid-19 Task Force chaired by the Deputy Governor, the officials of our Ministry of Health ably led by the Commissioner and our security/enforcement agencies, to manage and contain the spread of Covid-19 in the state.

 

 

I wish to acknowledge our Deputy Governor, Dr. Hadiza Balarabe, for her reassuring leadership of our team in my absence. In this trying period, our senior officials have demonstrated admirable commitment and the flexibility to provide governance in circumstances that are so different from the old normal. The commitment, competence and capabilities displayed by the Kaduna State Government in my four-week absence is clear evidence that we have a public service we can all be proud of.

I am relieved by my recovery. With the privilege of life, sound health, and the support and prayers of our citizens, I will continue to lead the Kaduna State Government’s efforts to ensure that as few of our people as possible get infected by Covid-19, and that those who do can receive adequate and timely care and treatment. Our emphasis is rightly on prevention because it is the prudent thing to do to save lives, given the limited capacity of our health system.

 

 

I am delighted by the recovery of four other Covid-19 cases who were discharged last week which was followed yesterday with the discharge of a fifth patient. On Monday, we received the sad news of three more positive cases in Kaduna State. They will receive the best care that our dedicated health professionals can muster and we wish them speedy recovery from Covid-19.

 

 

We must all work hard to ensure that we keep Covid-19 out of Kaduna State. We have lower infection rates than expected due to stringent measures we imposed in our state, but we cannot let our guards down. We are in dangerous times. This disease is a threat to our humanity, our lives and livelihoods. As someone that has experienced it, I will not wish it on my worst enemy.

 

We must reiterate that an infected person can show no symptoms as I did, for up to two weeks, while unknowingly infecting others close to him or even through casual contact. That is why mixing with many people is not a good idea. While four of every five infected persons show mild symptoms like headache, fever and cough and recover fully, there is evidence worldwide that older people and those with pre-existing health challenges like hypertension and diabetes are particularly at greater risk of dying if they get the Covid-19 infection.

We must therefore do everything to avoid exposure and prevent the spread of this disease in our towns and villages. We must now make the sacrifices of enhanced domestic hygiene, regular hand-washing with soap, staying at home and avoiding crowds to defeat this disease.

Let me conclude by informing the citizens of Kaduna State that I have issued another amendment to the Quarantine Regulations requiring everyone in the State to wear a face mask when going out of the home or workplace for any reason. The State Government is going to make these masks available free to the poor and vulnerable groups, and encourage everyone that can afford it to get their neighborhood tailor to sew cloth masks for their use. This will help protect them, their loved ones and everyone else from the spread of this disease.

 

 

Once again, we appeal to everyone to stay at home, observe social distancing, avoid gatherings of more than 10 people, and wash our hands with soap and water regularly.

Stay home, stay safe, save lives!

God Bless and Protect Kaduna State.

God Bless and Protect the Federal Republic of Nigeria.

Nasir Ahmad El-Rufai, OFR

Wednesday,22nd April 2020

 

Sultan Urges Muslims To use Facebook, Skype, YouTube,Zoom As He Declare, No Ramadan lectures & congregational prayers this year.

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Sultan Urges Muslims To use Facebook, Skype, YouTube,Zoom As He Declare, No Ramadan lectures & congregational prayers this year.

 

 

From AbdulGafar Alabelewe, Kaduna

As Muslims begin Ramadan fasting this week, the Sultan of Sokoto and President-General of Jama’atu Nasril Islam (JNI), Alhaji Muhammad Sa’ad Abubakar III, has declared that, there will be no Ramadan lecture sessions and congregation prayers in Mosques.

 

The Sultan told Nigerian Muslims that, this year’s Ramadan is one with a difference, in view of the COVID-19 pandemic, hence everyone should pray at home with their families, as Muslims cannot afford to be reckless with their lives.

Sultan in a statement issued through the Secretary-General of JNI, Dr Khalid Abubakar Aliyu, therefore, recommended that Muslim faithful should in addition to recitation of the Holy Qur’an, listen to Ramadan lecture through internet and other virtual means.

 

 

 

While noting that, most Muslim countries have unanimously agreed to suspend public religious congregation, in order to contain the COVID-19 pandemic, which he said, in actual sense is in tandem with the teachings of the Prophet, Sultan said, “As Muslims, we are not however oblivious of the fact that death is inevitable, but we must not be reckless with our lives, Q2:195 is a clear testimony to that effect.”

 

The statement read in parts that: “Jama’atu Nasril Islam (JNI) under the leadership of His Eminence, Alhaji Muhammad Sa’ad Abubakar, CFR, mni, felicitates in advance with the Muslim Ummah on the forthcoming month of Ramadan. Unequivocally, Ramadan is the month of the Qur’an, the month of Du’a (supplication) and Dhikr (Allah’s remembrance), the month of Zakah and Sadaqah (giving poor dues and charity), and the month of Qiyamul-Layl (standing in the night for prayers).

 

“But due to the overwhelming eruption of the novel COVID-19 pandemic, the Ummah’s enthusiasm needs to be reinvigorated as against what obtains of palpable fear over the pandemic outbreak.

 

“It should be made known that all Salawatun-nawafil (optional and nonobligatory prayers), including Taraweeh, are originally preferred to be observed at home, even though it is Mustahabb (desirable) to observe it in congregation.

 

“To sum it up, there will not be the annual Tafsir sessions and no congregational Taraweeh in mosques, until when situation permits. We should therefore pray with our families at home and stay safe.

 

 

 

“Medical experts and mid-course Ulama’s advice on COVID-19 should be religiously adhered to. We must collectively shun the vituperations of extremists in thoughts and actions on any matter, as warned by the Prophet (PBUH).

 

“Most often, extreme position on matters of religion creates more dissent views and counteractions, which in the final analysis generates acrimony and animosity rather than solutions, and for all intents and purposes that isn’t the essence of the Islamic faith!

 

“Despite the challenges of physical and social distancing, Tafsir and other religious teachings could continue using various information technology (IT) platforms, such as Facebook, Skype, YouTube, Zoom, etc., to live stream preaching sessions. Reliable information and communication technology (ICT) professionals could be consulted for proper guidance.

 

“It is on this basis that the JNI calls on the Ulama’ to as usual make the fear of Allah their watch word, bearing in mind that knowledge is a trust from Allah and shall be accounted for on the Day of reckoning, thus it should be handled with the utmost caution it deserves.

 

“Muslims should fervently pray for an end to the myriad challenges bedeviling the world and Nigeria in particular, and to also seek Allah’s interventions for better well-being and prosperity.” Sultan said.

 

Speaking on the economic effects of the lockdown on the fasting Muslims, Sultan called on the wealthy Muslims to increase their generosity during the Ramadan and extend hands to those in need, to ameliorate their sufferings by providing them with food and other necessities.

 

According to him, “This is a Ramadan with a difference as most people will be under lockdown. Hence, they will certainly be in dire need of assistance, because of the economic realities and the attendant suffocating inflationary trends. Our spirit of generosity should be fully activated in higher proportion so as to ameliorate the sufferings of the poor in our midst by providing them with food and other necessities.

 

“In this regard, the JNI calls upon those who have since planned for this year’s Umrah (lesser pilgrimage), to channel those resources to help the less privileged as the Umrah cannot be possible in the current global pandemic reality.

 

“The Prophet (PBUH) was reported to be the most generous of mankind and he used to be at the peak of his generosity during Ramadan. Expectedly, as our role model we should be seen to be doing exactly like Prophet Muhammad (PBUH).

 

“Bearing in mind that the month of Ramadan is fast approaching, we call on Governments at all levels to assist in making life bearable to the downtrodden. Likewise, business enterprises and their owners should review downward prices of goods and services – as an act of Sadaqah (charity) such that every ordinary man could afford.

 

“In this regard, worthy of commendation is the Nigerian business community, philanthropists as well as the business moguls who dished out colossal amount of money to support the federal and some state governments, at this critical economic period. The gesture remains very indelible to the JNI and we pray that they be compensated accordingly by Allah.

BREAKING: Imo state Government speaks on renaming University after late Abba Kyari

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BREAKING: Imo state Government speaks on renaming University after late Abba Kyari

 

 

The Imo state government has reacted to reports that the Governor, Hope Uzodinma is planning to rename the Imo State University, Owerri after late Chief of Staff, Abba Kyari.

POLITICS NIGERIA gathered that the rumour originated from a press statement reportedly the state government announcing the governor’s decision. The statement read;

“Governor Hope Uzodimma of Imo State has hinted that plans are in place to rename the state-owned Imo State University to Mallam Abba Kyari University. The Governor made this call when the management staff of the university led by the Vice-Chancellor, Prof. Adaobi Obasi paid him a visit at the Executive Chambers of the Imo State Government House.”

“The Governor went on to say that Mallam Abba Kyari played a pivotal role in the liberation of Imo State and no gesture is too big for a man who died as a patriot. The Governor also said that consultations are underway with relevant stakeholders both in the education sector and in the State to critically look at the situation and take a decision.”

“The Governor urged the management staff of IMSU to live up to expectation while pointing out that his administration is very committed to quality education in the State and that Imo State University as the epicentre can not be left behind.”

“The University management through the VC commended the Governor for a job well done so far. She also called on all and sundry to support His Excellency to succeed.”

However, when POLITICS NIGERIA reached out to the chief press secretary to Governor Uzodinma, Oguwuike Nwachukwu, he described the report as ‘fake news’.

He confirmed to this paper that the statement was not issued by the Imo state government.

 

Boko Haram factional leader, Abubakar Shekau Set to surrender

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The Boko Haram factional leader, Abubakar Shekau, is considering a ceasefire with the Nigerian government; credible intelligence sources in the North-East Theatre of Operations told The Vanguard.

 

 

 

The source told the newspaper that Mr Shekau had started making frantic efforts to seek a soft landing as he prepares to surrender.

 

According to the source, the Boko Haram leader has started reaching out to some International Non-Governmental Organizations for a deal with the Nigerian government towards granting him amnesty.

 

“I think the end of Boko Haram is coming close as Abubakar Shekau has been making overtures through proxies for a soft landing for him to surrender to the Nigerian authorities.

 

“He has been desperate about it, and the intensity is occasioned with the avalanche of coordinated operations launched in recent times against the group, especially in the Timbuktu triangle,” the source said.

 

The source further added that in recent times the Boko Haram group had suffered casualties that put the group in a tight corner.

 

According to him, the gap is closing in on Abubakar Shekau as it stands.

 

“The series of coordinated attacks on their hideouts has made it impossible for any escape as the military has been attacking from several flanks, and any attempt to escape now is virtually impossible.”

 

“The Chief of Army Staff has given an order that Abubakar Shekau is captured alive. The Chief has been in Borno State and there is a likelihood that he is going to be around for a long period given his body language of not leaving anything to chance in this critical operation,” the source added.

 

The newspaper also gathered that the Boko Haram group had also reached out to some International Non-Governmental Organizations to seek a deal with the Nigerian government towards granting amnesty to it.

 

A top staffer of one of the NGOs (name withheld) confirmed that on several occasions, Mr Shekau had sent emissaries to their organization to help secure an amnesty deal with the government of Nigeria.

 

“We were shocked in the initial stages, thinking it was a hoax. But this continued, and we were left with no choice than to inform the security agencies in a bid to protect ourselves.”