According to the regulations set forth by the Nigerian central bank, subsidiaries of mobile network operators (telcos), mobile money operators, retail chains (supermarkets), and banking agents are eligible to apply for the PSB license, provided they meet specific requirements. These prerequisites include a capital base of 5 billion naira ($12 million) and a combined application and license fee amounting to 2.5 million naira ($6,400), which are non-refundable.
The issuance of these new banking licenses to Nigeria’s leading telcos follows the release of updated guidelines for the licensing and regulation of payment service banks by the CBN on August 27, 2020.
Under the Nigeria Finance Act of 2023, a capital gains tax of 10% has been introduced for digital assets. This tax is applicable when selling or disposing of valuable digital items that result in a profit. The tax calculation involves deducting allowable deductions from the total earnings in a specific assessment year. It applies to a wide range of property types, including options, debts, and intangible assets, regardless of their physical location. The tax also covers foreign currencies, except for the Nigerian currency. Any property that is created or acquired without purchase is considered an asset for tax purposes. However, the Act does not provide a clear definition of what constitutes a digital asset, leading to controversies regarding its scope and intentions.
The Central Bank of Nigeria has issued a series of new guidelines to govern how a holder of a fintech license in Nigeria may combine it with other types of fintech licenses in a holding company structure.
Under the new rules, termed “GUIDELINES FOR LICENSING AND REGULATION OF PAYMENTS SERVICE HOLDING COMPANIES IN NIGERIA”, companies that wish to operate under more than one license category must establish a Payments Service Holding Company (PSHC) with clearly defined subsidiaries.
As a part of the United Arab Emirates, the emirate of Dubai has added a new dimension to its appeal. A new law has been passed to make it easier for entrepreneurs to obtain crypto license s, in addition to its reputation as a tax haven. As the global financial system strives to give credibility to virtual assets, this is a deal breaker for everyone. The new Law No. (4) of 2022 Regulating Virtual Assets in the Emirate of Dubai was published in Dubai’s Official Legal Gazette on March 11, 2022, and took effect immediately. Below, we explore how African startups can obtain a crypto license under the new legal regime in Dubai.
What Does The Law Provide?
For the first time, the law has set up a public corporation called the “Dubai Virtual Assets Regulatory Authority.” This public corporation, which is linked to the Dubai World Trade Center Authority, is in charge of developing regulations, rules, and standards for regulating, supervising, and overseeing Virtual Asset Platforms, Virtual Asset Service Providers, and all other Virtual Asset-related issues.
Financial technology companies in Nigeria that do not have the financial capacity to go for any of the license categories recently introduced by the Central Bank of Nigeria can now heave some sighs of relief. This is because the central bank has finally released a framework for regulating sandbox operations in the country. Unlike other fintech categories, such as agency banking or mobile money that require thousands of dollars in application fees to obtain licenses, no such fees are required for the grant of the regulatory sandbox license.