How to Obtain an IMTO License in Nigeria

How to Obtain an IMTO License in Nigeria

IMTO License in Nigeria

An International Money Transfer Operator – IMTO license is the legal document that enables financial companies to facilitate the speedy transfer of funds from Nigeria to any destination abroad. 

 With the emergence of Financial Technology (Fintech), remittances and cross-border payments in the country have become a walk in the park thanks to IMTO licenses.  Some of these technologies include major money transfers such as Western Union, MoneyGram, PayPal, Ria Financial, TransferWise, Flutterwave, Interswitch, and others.

The acquisition of the IMTO license by these multibillion-dollar companies is proof of its importance/ 

In this article, we will cover:

  • the requirements for obtaining an IMTO license in Nigeria;  
  • an overview of the application process; and
  • The benefits of acquiring an IMTO license for your Fintech

What is a Nigerian IMTO license?

An International Money Transfer Operator license is a legal authorization or permit issued by the Central Bank of Nigeria (CBN) to facilitate a company’s or individual’s ability to perform money transfer services internationally.  

It is an essential license for individuals or businesses involved in the transfer of money across national borders and ensures that these transactions are conducted within the confines of the law while following specific regulations and standards.  

Importance of an IMTO license

The core importance of an IMTO License is its authorization for businesses and individuals to undertake cross-border transactions. IMTOs are essential to the remittance industry of Nigeria and other financial activities.

 Some of the other important benefits of getting an IMTO license include:  

 1. Legal Compliance and Regulation: An IMTO license is a symbol of legal compliance and adherence to necessary regulations and rules. It ensures that the operator is willing to obey the existing legal and regulatory frameworks and is ready to prevent illegal or fraudulent money transfers. Operating as an IMTO without a license carries significant legal consequences in Nigeria. Those found in violation of the law may face fines, penalties, and even criminal charges.

2. Consumer Protection: Obtaining an IMTO license is a way of safeguarding the interests of consumers. Through the Know Your Customer (KYC) compliance rules, measures such as verifying the identities of both the senders and receivers ensure that funds are transferred securely and transparently. Thereby showing consumers that the operator cares about their financial well-being. 

3. Business Expansion and Opportunities: For businesses, obtaining an IMTO license can open up new revenue streams and business opportunities. It allows you to offer international money transfer services, which can be an attractive service for customers and a source of income for the business itself.

4. Market Credibility: Operating with an IMTO license signals to customers and partners that a business is committed to legal compliance, transparency, and customer protection. This can enhance the credibility and trustworthiness of the IMTO in the market, attracting more customers and business opportunities.

In an interview with Lemfi’s Country Manager, Dolapo Omotoso, the CM commented on the company’s lMTO license acquisition, saying “We are delighted that RightCard has received its CBN’s license, which is a testament to our commitment to compliance and dedication to serving the Nigerian market. This milestone strengthens our position as a leading international money transfer operator and demonstrates our goal of empowering individuals by providing seamless, secure, and affordable money transfer services.” 

This statement is a testament to the magnitude of trust an IMTO can create between service provider and customer.

Requirements for an IMTO license in Nigeria

According to the CBN, interested applicants are required to forward their requests for licensing to the Director, Trade and Exchange Department of the CBN, in line with the CBN Guidelines on International Money Transfer Services in Nigeria (2014), which among other things, specifies the minimum technical and business requirements for various participants in the international money transfer services industry in Nigeria.

These application requirements include: 

1. Board of directors’ approval to offer international money transfer services. 

2. Copy of the applicant’s certificate of incorporation. 

3. Memorandum & Articles of Association (certified copy), of which the primary object clause shall indicate the provision of Money Transfer Services. 

4. Shareholding structure of the Company. 

5. Forms C02 (Return on Allotment of shares) and C07 (Particulars of Directors). 

6. Profiles of the Board and Management of the Company to include CVs, functional contact e-mails and telephone numbers, ownership, governance, and management structure. 

7. Organogram of the company. 

8. Business Plan, to include: 

  • Nature of the Business. 
  • Features of the scheme. 
  • Internal control systems and monitoring procedures. 
  • Security features that will be put in place. 
  • 3 years financial projections/Market analysis for the Company. 
  • Transaction and other charges that will be borne by customers. 
  • Profit-sharing agreement among the parties. 
  • Diagrammatic illustration of transaction flows. 
  • Consumer Protection and Dispute Resolution Mechanism. 

9. Information Technology Policy of the Company including: 

  • Privacy Policy. 
  • Information Ownership/Disclosure/Loss Policy. 
  • Backup and Restore Policy. 
  • Network Security Policy. 
  • Encryption Policy. 
  • Confidential Data Policy. 
  • Password Policy. 
  • Third-Party Connection Policy. 
  • Incidence Response Policy. 
  • Physical Security Policy. 

10. Enterprise Risk Management Framework. 

11. Contingency and Disaster Recovery Plan (business continuity plan). 

12. Draft agreements with the participating parties. 

13. Tax Clearance Certificate for three (3) years. 

14. Project Deployment Plan (time, location, operation, etc.). 

15. Credit reports from a licensed credit bureau for the shareholders and key officers of the money transfer services operator. 

16. Any other information may be required by the CBN from time to time. 

17. A non-refundable application fee of N500,000 (Five Hundred Thousand Naira) or such other amount that the Bank may specify from time to time, payable to the “Central Bank of Nigeria” by electronic transfer. 

18. Evidence of meeting the minimum paid-up share capital of: 

  • N2,000,000,000 (Two Billion Naira) for Nigerian companies. 
  • N50,000,000 (Fifty Million Naira) or its equivalent for foreign companies, plus the guarantee of the parent company. 

19. Presence in at least seven (7) different countries. 

IMTO Requirements for Overseas Partnerships 

According to the CBN, a money transfer operator (MTO) wishing to engage a foreign technical partner that will provide a global or regional payment or money transfer platform shall obtain a letter of no objection from the Central Bank of Nigeria. The following conditions shall apply to the technical partner: 

 1. Registration and Licensing: 

   a. The technical partner must be a registered entity licensed in its home country to carry out money transfer activities. 

2. Financial Strength: 

   b. The technical partner should have a minimum Net Worth of US$1 million, as per the latest audited financial statement, or as may be determined by the CBN from time to time. 

3. Operational Track Record: 

   c. The overseas technical partner should be well established in the money transfer business, with a track record of operations. 

4. Memorandum of Understanding (MOU): 

   d. There should be a Memorandum of Understanding (MOU) that delineates liabilities in the event of disputes and/or process failures. 

 Additionally, the CBN shall conduct appropriate due diligence on the promoters, directors, and key officers of the proposed money transfer operator. This due diligence process is essential for ensuring the suitability and integrity of those involved in the operation. 

Non-Permissible Activities

IMTOs must refrain from:

  1. Conducting financial transfers between individuals and corporate entities, by Anti-Money Laundering (AML/CFT) regulations.
  2. Participating in money lending activities.
  3. Operating as an authorized dealer in precious metals.
  4. Offering monetary deposit services.
  5. Managing current accounts for clientele.
  6. Creating letters of credit.
  7. Functioning as a funds custodian for customers.
  8. Involvement in institutional transfers.
  9. Purchasing foreign exchange from the domestic foreign exchange market for settlement.

Regulators of Cross Boarder Transaction Operators

1. CBN Act (2007)

The CBN Act establishes the Central Bank of Nigeria (CBN) and grants it the authority to regulate and supervise financial institutions and services. It outlines the CBN’s powers and functions, including those related to monetary policy, financial stability, and financial services regulation. The CBN Act provides the legal basis for the CBN’s oversight of IMTO licensing and operations. 

 2. International Money Transfer Operator (IMTO) Guidelines

The IMTO Guidelines specifically govern the operations of IMTOs in Nigeria. These guidelines provide detailed information about licensing requirements, capital requirements, technology infrastructure standards, KYC (Know Your Customer) and AML (Anti-Money Laundering) procedures, transaction reporting, consumer protection measures, and compliance obligations for IMTOs. 

3. Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) Laws and Regulations

IMTOs are subject to Nigeria’s AML/CFT laws and regulations, which are aimed at preventing money laundering and terrorist financing activities. These laws require IMTOs to establish and implement robust KYC and AML procedures, report suspicious transactions, and cooperate with authorities in AML/CFT efforts. 

4. Banks and Other Financial Institutions Act (BOFIA)

The BOFIA regulates the activities of banks and other financial institutions in Nigeria, including IMTOs. IMTOs often have partnerships with banks to facilitate money transfers, and this act governs their interactions with financial institutions. 

Guidelines for a smoother application process

Applying for an IMTO (International Money Transfer Operator) license is a significant undertaking that involves navigating complex regulatory requirements. Here are practical pieces of advice to help you have a smoother application process: 

 1. Understand the Regulatory Framework

Start by thoroughly understanding the specific regulations and guidelines set by the Central Bank of Nigeria (CBN) and other relevant authorities. Stay alert for any updates or changes in regulations.

 2. Consult with Experts 

Consider seeking legal and financial advice from experts who specialize in IMTO licensing. They can provide guidance on meeting regulatory requirements and navigating the application process. 

 3. Gather Required Documentation

Start early in collecting all necessary documents. Ensure that you have all the required paperwork, including application forms, business registration documents, financial statements, criminal record checks, tax clearance certificates, and ownership structure information. 

 4. Organize Your Financials

Ensure that your financial statements are accurate, up-to-date, and well-organized. This includes balance sheets, income statements, and cash flow statements. Meeting the minimum capital requirement is critical. 

 5. Focus on Compliance

Develop robust Know Your Customer (KYC) and Anti-Money Laundering (AML) procedures, as required by regulations. Implement technology and processes that can effectively enforce these procedures. 

6. Prepare for Inspections

Be ready for site visits and inspections by regulatory authorities. Ensure that your business premises and technology infrastructure comply with regulatory standards. 

7. Clear Criminal Records

Ensure that you and key personnel have clean criminal records. Address any potential issues proactively. 

8. Budget for Fees and Expenses 

Budget for application fees and any other expenses associated with the licensing process. Be prepared to pay these fees promptly when required. 

9. Be Patient and Persistent

Understand that the licensing process can be time-consuming and may involve multiple steps. Be patient and persistent in following up with regulatory authorities and providing requested information. 

10. Stay Informed 

Continuously monitor updates and changes in regulations related to IMTO licensing. Ensure that your operations remain in compliance with evolving requirements. 

11. Engage with Regulatory Authorities 

Maintain open communication with regulatory authorities throughout the application process. Seek clarification on any questions or concerns you may have, and proactively address any issues that arise. 


An IMTO license is a key element in the global effort to combat financial crime and maintain the integrity of the international financial system. 

Nigeria is an economic powerhouse in Africa and an even bigger deal when it comes to remittances. The CBN has so far licensed over 60 IMTOs with many foreign-based IMTOs looking to debut in the Nigerian market alongside local ones 

 Seeking to understand the regulations around IMTO licensing and compliance is a step in the right direction and we wish you good luck in your acquisition process.  

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