The Corporate Affairs Commission (CAC) has successfully registered 100,000 Point of Sale (POS) operators under its formalisation initiative, aimed at reducing fraud, combating ransom payments, and enhancing the formal economy. Despite this progress, the commission is falling short of its target, having expected 250,000 registrations by the end of the project, which ran from July 7 to September 5, 2024.
The Registrar-General of CAC Hussaini Magaji, revealed these figures during an In-House Enforcement and Compliance Training for state offices held in Abuja on Monday. The training, designed to enhance the commission’s compliance and enforcement capabilities, drew participants from all 36 states of the Federation.
Magaji emphasized that the formalisation project was critical in reducing illegal activities such as money laundering and terrorism financing. He explained that while some fintech companies recognized the importance of formalising businesses to ensure legal operations, others remained fixated on outdated informal business practices.
“Some fintech companies and their POS operators have seen the benefits of formal registration, which improves transparency and enables access to government interventions,” said Magaji. “However, others continue to operate informally, often with cash stored in unsecured locations.”
The POS formalisation drive is part of a broader CAC initiative to formalise businesses in Nigeria. According to Magaji, there are an estimated 40 million micro, small, and medium enterprises (MSMEs) in the country, and the CAC’s goal is to formalise at least 50% of them.
Magaji also warned that engaging with unregistered businesses is risky, as they can disappear without trace and are more susceptible to illicit activities. He urged business operators to take the necessary steps for registration before facing regulatory penalties.
As part of its ongoing efforts to enhance the efficiency of its operations, the CAC is exploring the integration of Artificial Intelligence (AI) into routine tasks like name reservation and registration. This move aims to free up human resources to focus on more complex issues that require discretion and judgment.
In addition, the CAC is restructuring its organizational framework, which will be implemented once approved. The restructuring is designed to align the commission with global standards and improve its overall efficiency.
Magaji also highlighted the importance of proper disclosure of ownership structures, particularly with regard to shell companies and individuals with significant control, in compliance with international regulations. He stressed that the training for state offices would focus on the effective handling of unregistered businesses, including POS operators.
The CAC’s Enforcement Officers Training is set to conclude on January 25, 2025, and will continue to focus on improving the commission’s capacity to tackle challenges in formalising Nigeria’s business environment.