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PROCEDURE FOR OBTAINING MONEY LENDING LICENSE IN NIGERIA

HOW TO OBTAIN MONEY LENDING LICENSE IN NIGERIA

HOW TO GET A MONEY LENDER LICENSE IN LAGOS STATE

A Money Lending License in Nigeria can be granted to an individual or a corporate body. However, obtaining the money lender license through a corporate body is more advisable.

The Money Lending Law of the various states in Nigeria regulates money lending business operation. The step for how to get a money lenders license in Lagos State commences by making a prescribed application to the Chief Magistrate.

For an individual or company to become a legitimate money lender, the individual or company must obtain the Money Lender License to practice in Nigeria. Section 4 of the MoneyLenders Law Chapter 7 Laws of Lagos State provides that a person who lends money at interest or who lends a sum of money in consideration of a larger sum being repaid shall be presumed to be a money lender until contrary is proven”.

Only persons licensed to be moneylenders by the relevant government authority are permitted to be moneylenders. One of the benefits of being a licensed moneylender is that a moneylender can exercise its right in instituting an action in Court to recover principal loan and accrued interest from a default borrower.

Requirements for the application of a Money Lending License in Lagos.

  1. A cover letter with the Company seal affixed to it
  2. Official address of the Individual applicant or Company.
  3. Office address of the Individual applicant or Company
  4. Certified True Copy of the CAC 2 (Authorised Share Capital) of the Company
  5. Certified True Copy of the CAC 7 (Particulars of Directors)
  6. Memorandum and Article of Association of the Company
  7. Certificate of Incorporation of the Company
  8. Tax Clearance for the individual applicant or Corporate Body, if it is a company newly incorporated, then provide evidence that the company is a registered tax payer
  9. Police Clearance for the Individual applicant or Company
  10. Evidence of maintenance of a current account with a licensed Bank

Steps and Procedure for applying for a Money Lending License

  1. Make an application to the Chief Magistrate within the jurisdiction of the Magistrate Court where the business will be carried on, with the applicant’s letterhead
  2. Such letter shall be attached with the following supporting document:
  3. Certified True Copy of the company’s incorporation documents.
  4. Memorandum and Article of Association of the Company. The objects in the company’s memorandum must include financial service or money lending business.
  5. Certificate of Incorporation of the Company
  6. Tax Clearance for the individual applicant or Corporate Body, if it is a company newly incorporated, then provide evidence that the company is a registered tax payer
  7. Police Clearance for the Individual applicant or Company
  8. Evidence of maintenance of a current account with a licensed Bank
  • Upon application to the Magistrate, the applicant will be issued a letter and Forms B and C.
  • The applicant is to make payment of the prescribed application fee to the Office of the Magistrate.
  • After obtaining the necessary court documents, the applicant is to make a formal application to the Ministry of Home Affairs and Tourism with the following documents:
  • An application letter to the Ministry
  • Money Lending Ordinance (Form B) 1938, issued from the Magistrate Court
  • A duly completed Magistrate Form C
  • Police report from the Commissioner of Police Showing fingerprints of the Directors of the Company or Individual Applicant
  • 3 years Income Tax Clearance Certificate for each individual applicant or Directors of the Company
  • PAYE (Pay as You Earn Certificate), Tax Clearance of at least 2 Directors or Evidence of Company Taxes
  • Certificate of Incorporation of the Company
  • Evidence of payment of application fee into the Lagos State Account.
  • Evidence of maintenance of a current bank account with a reputable bank
  • The Applicant is to make a payment of the official fee of N50,000 into the Lagos State Account
  • The applicant will be required to make the payment of N10, 000 for the Application Form with the Receipt evidencing payment.
  • The next step is to collect an invoice from the Ministry of Affairs and Tourism Revenue Collection Department for the payment of N50, 000 Money Lenders Fee.
  • Upon obtaining the form, complete the form and pay into the Department’s Account.
  • The Final stage includes the visitation and physical inspection of the intended office by government officials. Upon visitation, if the company in question is already operating in the money lending activities, the books will be inspected in addition to the office.
  • If the company complies with the statutory requirements and upon the government officials’ satisfaction, the applicant will be issued with the Money Lending License Certificate.

In conclusion, it is important for any individual or companies who intend to carry on money lending services to obtain the License from the Ministry of Home Affairs and Tourism so as to legitimize the business and also be entitled to an absolute legal remedy.

Finally, a typical Financial Technology (FINTECH) startup company seeking to engage in money lending business through mobile technology must also obtain a money lending license from each and every state such a company intends to operate its business.

By Resolution Law Firm

Email:info@resolutionlawng.com

Tel: +2348099223322

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