February 3, 2026

How to Obtain IMTO License Requirement in Nigeria: What You Need To Know

by Ekosolicitors

INTRODUCTION TO IMTO LICENSE REQUIREMENT

Nigeria’s financial landscape is deeply linked to remittances AKA “black tax” which are funds sent home by Nigerians abroad to support households, businesses, and national foreign exchange reserves. These international money transfers are not only economic lifelines for many families but also strategic sources of foreign exchange inflows for the Nigerian economy. However, one cannot legally operate as an International Money Transfer Operator (IMTO) in Nigeria without first securing a licence from the Central Bank of Nigeria (CBN).

Doing so ensures compliance with regulatory standards, protects consumers, and integrates remittance flows into the formal financial system. The licencing regime for IMTOs was revised significantly in 2024, formalising a two-stage approval process and setting stringent requirements on capital, governance, documentation, and compliance standards. This article examines the legal foundation, procedural stages, requirements, renewal mechanisms, and legal consequences of non-compliance in the IMTO licencing process in Nigeria. This article seeks to provide a clear, structured explanation of how to obtain an IMTO licence, anchored in Nigeria’s legal and regulatory framework.

1. Legal and Regulatory Basis for IMTO Licensing (IMTO LICENSE REQUIREMENT)

1.1 Central Bank Act and Power to Regulate IMTOs

The CBN derives its power to regulate licences for IMTOs primarily from Section 2(d) of the Central Bank of Nigeria Act 2007. This provision empowers the Bank to issue guidelines aimed at maintaining “promote a sound financial system in Nigeria,” including international money transfer services. The 2024 IMTO Guidelines are issued pursuant to this statutory authority and are thus binding on applicants and operators.

In addition, the regulatory framework links to provisions under the Banks and Other Financial Institutions Act (BOFIA) 2020, reinforcing the standards that regulated financial intermediaries must meet before undertaking specific financial activities, including remittances.

2. Overview of IMTO Licence Purpose and Scope

An International Money Transfer Operator (IMTO) licence authorises entities to facilitate the transfer of funds from individuals or entities outside Nigeria into Nigeria, using recognised clearing networks. Unlike other financial licences, the IMTO authorisation focuses on inbound cross-border remittances including person-to-person, business-to-person, and business-to-business transactions and aims to strengthen the link between diasporic remittances and formal financial channels.

Under the current guidelines, IMTOs are prohibited from outbound remittances and from purchasing foreign exchange on the domestic market for settlement, though recent circulars have adjusted how eligible operators may access official FX windows.

3. Two-Stage Application Process(IMTO LICENSE REQUIREMENT)

The 2024 Revised Guidelines introduced a clear procedural framework involving two main approval phases:

3.1 Approval-in-Principle (AIP)

This is the first stage where the applicant demonstrates its preparedness and capability to meet regulatory standards:

Submission Of IMTO License Requirement

Applicants must submit a formal application to the Director, Trade and Exchange Department, CBN, accompanied by a non-refundable application fee of ₦10,000,000 (Ten Million Naira). Required documentation generally includes:

Certificate of incorporation and Memorandum & Articles of Association, with the primary business object including IMTO services.
Evidence of approval to operate in other jurisdictions or an agency agreement confirming permissible activities overseas.
Ownership structure and corporate governance documentation, including board resolutions approving the IMTO application.
Tax clearance certificates and compliance proofs (e.g., VAT, corporate tax compliance).
Profiles of directors/management and beneficial ownership details.
Credit reports on key officers and shareholders from licensed credit bureaus.
Evidence of minimum share capital US$1,000,000 for foreign IMTOs and the equivalent for indigenous entities.
Compliance frameworks for Anti-Money Laundering (AML), Combating the Financing of Terrorism (CFT), and Countering Proliferation Financing (CPF).

Once the AIP application satisfies the CBN’s due diligence, the Bank may grant an Approval-in-Principle, which does not authorise commencement of business but allows the applicant to open bank accounts and proceed with pre-operational processes.

3.2 Final Approval

After obtaining AIP, applicants have a limited period (usually 3 months) to apply for Final Approval, which is required before operations commence. In addition to the documents submitted at the AIP stage, the applicant must provide:

Details of authorised dealer banks that will act as settlement partners and agent banks.
A detailed business plan covering operational, financial, and compliance structures.
Any additional requirements specified by the CBN, including operational readiness evidence such as IT systems, risk management frameworks, and consumer protection mechanisms.

Upon satisfying all CBN requirements, Final Approval is granted and the IMTO licence issued.

4. Post-Issuance Obligations and Renewal

4.1 Annual Renewal

IMTO licences must be renewed annually. The renewal fee is also ₦10,000,000 and must be paid on or before 31st January of each year. Failure to renew within the first quarter of the year may lead to operational suspension or cessation by the IMTO’s agent bank.

4.2 Reporting and Compliance Requirements

Licensed IMTOs are required to:

Maintain accurate transaction records for a minimum number of years and file regular returns with the CBN.
Ensure ongoing compliance with AML/CFT/CPF obligations.
Implement operational risk frameworks, internal controls, and systems that protect customer funds.
Partner with authorised dealer banks to domicile remittances and ensure compliance with payout and settlement obligations.

5. Prohibitions, Restrictions and Entities Excluded

Under the 2024 Guidelines, banks and financial technology companies (FinTechs) are prohibited from directly obtaining new IMTO licences though banks may act as agents for licensed IMTOs. This restriction aims to ensure that dedicated remittance operators are the direct providers of international transfer services while mobilising broader financial ecosystem support through agency networks.

Licensed IMTOs must strictly adhere to regulatory boundaries: operating only the permitted inbound remittance services; avoiding unauthorised activities; and observing all CBN directives on foreign exchange handling and settlement. Non-compliance may result in sanctions, licence revocation, or regulatory action.

6. Legal Consequences of Operating Without a Licence

The licensing regime is not merely procedural as operating an IMTO without CBN approval is illegal in Nigeria. Any person or institution offering international money transfer services without a licence may be subject to regulatory sanctions, including enforcement actions by the CBN, fines, and possibly orders restraining operations. Customers and counterparties ought to ensure that service providers carry valid licences, failing which they risk loss of funds and lack of legal recourse.

Conclusion On IMTO License Requirement

Obtaining an IMTO licence in Nigeria is a highly regulated, phased process designed to ensure that international money transfer services are provided only by credible, financially sound, and compliant operators. Anchored in the CBN Act 2007, the Revised Guidelines on International Money Transfer Services 2024 set out a two-stage process, significant documentation and capital requirements, annual renewal obligations, and compliance frameworks aimed at safeguarding the financial system and protecting consumers.

Prospective applicants must appreciate that an IMTO licence is not only a commercial permit but a regulatory commitment to transparency, financial integrity, and adherence to stringent anti-money-laundering and governance standards. With remittances playing a central role in Nigeria’s economic dynamics, the licencing regime helps channel critical foreign exchange inflows through regulated, transparent mechanisms. And in the absence of case law directly on IMTO licence challenges, practitioners rely on established judicial principles that regulatory decisions based on clearly articulated statutory powers (e.g., CBN Act, BOFIA) are valid when fairly applied.

Contributors