In recent times, there has been some technological advancements in Nigeria. Through the use of technology, individuals can provide financial services for themselves and their businesses.

In Nigeria, there are 3 regulatory bodies that regulate the activities of money lenders and their companies. They are: The State governments, the Central Bank of Nigeria and the Federal Competition and Consumer Protection Commission (FCCPC). These three bodies are responsible for;

1. Ensuring that money lending activities are carried out fairly and transparently,

2. Protecting the interest of borrowers,

3.  Maintaining stability in the financial sector.

4. Leasing of equipment.

The procedure for obtaining a money lender’s license varies from one state to another. For money lenders to operate legally, these private lenders must obtain a money lending license in the state where their lending company is established. Each state in Nigeria has a legislation governing lending that also regulates the activities of money lenders.

Procedure for obtaining lending license in Ibadan.

The license when obtained can be used anywhere in Nigeria and it is not limited to only Ibadan.

To obtain a lending license in Ibadan, the founder of the company must fulfill the following criteria:

1. Write an Application Letter and address it to the Chief Registrar of the Magistrate Court at Iyaganku, Ibadan.

2. Submit the following documents along with your application letter:

a. 2 passport photographs.

b. 2 photocopy of CAC certificate.

c. National means of Identification (National ID CARD).

d. Scan of your Fingerprint

e. Police report (Should be done in Ibadan), to validate the authenticity of the report. However, the police report can be done outside Ibadan, as long as the authenticity of the report is validated.

f. Pay the Necessary Fees and attach the receipt of payment.

Procedure for Obtaining a Money Lenders License in Lagos State.

1. Write an application and address it to the Chief Magistrate within the Magisterial District where the lending business will be carried on.The application will be accompanied by the incorporation documents of the company and other relevant documents such as:

a. Certificate of company registration and other incorporation documents

b. A police fingerprint certificate of the two directors of the company.

2. Upon successful application to the Chief Magistrate, the applicant will be issued a Money Lenders Certificate (Form B) recommending the issuance of a Money Lenders License.

5. Submit a formal application to the Lagos State Ministry of Home Affairs and Tourism attaching all relevant documents.

6. Pay the necessary fee into the Lagos State Government Account with receipt evidencing payment.

7. The company must have a banner displaying the business activities of the company and the company’s vision.

8. The three-year tax clearance certificates for the two directors of the company.

9. Banker reference letter addressed to the Permanent Secretary, Ministry of Home Affairs

10. The Lagos State government officials will inspect the applicant’s place of business physically.

11. Upon compliance with the necessary requirements and upon satisfaction by the government officials from the Ministry of Home Affairs & Tourism, the applicant will be issued with the Money Lending License.

Although, it is important that the founder of the company is present to carry out the required processes but he can employ the services of a business lawyer to assist him with the procedure.

After the procedure is successful, the founder is given a lender’s certificate and a license. The certificate does not need to be renewed but, for the license, the founder has to renew it annually as it expires on the 31st of December every year. The founder has to renew his license within one year of issuance. Moreover, the license can be used in any state within Nigeria.

If the founder fails to renew his license within a year, he would be unable to use his license if the current one expires. And, when he intends to renew his license, he would have to pay for the initial year that he refused to pay and also pay for the following year which he intends to use his license. Although, the founder will not be issued any license for that year that he refused to pay but will be issued a license for the following year.