February Regulatory Roundup 2025
Welcome to the February regulatory round up 2025. We provide you with the latest regulatory news and insights across Nigeria, Africa and beyond. Let’s dive into a thoughtful and comprehensive update on recent developments.
Regulatory Update in Nigeria
- Nigerian Commercial Banks Explore Potential Mergers Ahead of Recapitalization Deadline.
- CBN Extends deadline for Forex Purchase on NFEMS by BDCs
- FIRS Commences Withholding Tax System Implementation.
- CBN Revises ATM Charges for Banks and other Financial Institutions
- Nigeria’s first local Stablecoin, cNGN, Launches following SEC provisional Licence
- Nigeria Commences Effort to Tax Crypto Transactions
- Central Gaming Bill Passes Second Reading
- CBN Releases Guidelines for the Management of Dormant and Inactive Accounts
- CBN Orders Resignation of Bank Directors with Non-Performing Loans
- Federal High Court Affirms FCCPC’s Multi Sectoral Jurisdiction
- Meta in fresh lawsuit Over Privacy Violations
- Flutterwave Considers Possible NGX Listing
- New NIBSS reports indicate surge in fraud incidences
Regulatory Updates Across Africa
- Airtel Money under Probe by COMESA
- Kenya Central Bank to Crack down on Commercial Banks over Lending Rates
- Ghana’s NIA to Integrate National ID with Financial Service Credentials
- Ghana Unveils Plan to Launch e-Cedi in 2025
- Kenya Revenue Authority’s Push to Integrate with Banking Systems Meets Huge Resistance
- South Sudan to Launch First National Instant Payment System
- Ghana and Rwanda Kickstarts Fintech Passporting System
- Nigerian Startup, Startbutton Expands to Seven Francophone Countries, Easing Regulatory Compliance for Businesses
Regulatory Updates Across The World
- Bybit Suffers Cybersecurity Breach, Resulting in Largest Crypto Heist in History
- California Considers New AI Bill
- US SEC to Change its Digital Assets Oversight Approach
- Philippines Exits FATF Greylist
- Swiss Bank Unveils Tokenized Gold Product
- India’s IFSCA Unveils Consultation Paper on Regulatory Approach Towards Tokenization of Real-World Assets
Crypto Scoop
- States in the US Move to Establish Bitcoin Govt Reserves
- Central African Republic President Launches Memecoin
- SEC to Drop Law Suit Against Coinbase
Mergers and Acquisitions
- IBM Acquires Hashicorp, in a $6.4 billion Deal.
- Montagu Acquires Temenos’ Multifonds for $400M
Deals and Raises
- Affinity Africa Raises $8 million in Seed Round
- Sardine AI Raises 70 Million in Series C Funding to Boosts its AI Fraud, Risk and Compliance Solutions
- Raenest Secures $11 Million in Series A Funding, Braces up for Expansion to New Markets
Regulatory Update In Nigeria
Nigerian Commercial Banks Explore Potential Mergers Ahead of Recapitalization Deadline
With the Central Bank of Nigeria’s (CBN) bank recapitalization deadline set for March 2026, reports have indicated that several Nigerian commercial banks are exploring possible mergers and acquisitions in order to meet the capital requirements. Fintechs and startups partnering with these banks may experience disruptions, regulatory uncertainties, and shifts in banking relationships. Businesses should stay informed and assess potential impacts on payments, lending, and liquidity access.
CBN Extends deadline for Forex Purchase on NFEMS by BDCs
The Central Bank of Nigeria (CBN), in one of its latest circulars, has granted a deadline extension, allowing Bureau de Change (BDC) operators to purchase foreign exchange, with a cap of $25,000 weekly from authorized dealers in the Nigerian Foreign Exchange Market (NFEM), up until May 30, 2025. This move aims to stabilize retail FX supply and ensure market liquidity. For fintechs and startups involved in FX transactions or cross-border payments, this extension provides a longer window for structured access to FX but requires strict compliance with pricing and reporting rules.
FIRS Commences Withholding Tax System Implementation
Federal Inland Revenue Services (FIRS) has commenced the implementation of the Withholding tax system, mandating the deduction of taxes directly from payments such as salaries, rents, professional fees and dividends. This comes with stricter tax compliance obligations on businesses, employers and other payers to deduct taxes at the point of payment with integration of Tax Identification Numbers (TINs) in transactions, and potential investment in tax software.
Nigeria’s first local Stablecoin, cNGN,Launches following SEC provisional Licence
The Nigerian Securities and Exchange Commission (SEC) has granted a provisional licence to cNGN, Nigeria’s first local Stablecoin, linked to the Nigerian naira. While this development undoubtedly positions Nigeria as a leader in Africa’s fintech sector, offering a regulated digital currency that bridges traditional finance with blockchain technology, the stability of cNGN is however intrinsically linked to the Naira’s performance, which has experienced volatility in recent years, transparency, security, and stability will be key to cNGN’s long-term success in Nigeria’s digital economy.
CBN Revises ATM Charges for Banks and other Financial Institutions
The Central Bank of Nigeria (CBN) has issued new ATM withdrawal charges for banks and financial institutions. Withdrawals from on-site ATMs (within bank premises) now attract a ₦100 fee per ₦20,000, while off-site ATMs (outside bank premises) carry an additional surcharge of up to ₦500 per ₦20,000 withdrawal. While this move aligns with CBN’s push for a cashless economy, increased ATM usage and additional revenue to be channeled into ATM maintenance for banks, concerns remain about its impact on the cash-dependent informal sector. However, the directive may also encourage payment service license holders to expand digital payment gateways, providing alternative transaction methods and reducing reliance on physical cash.
Nigeria Commences Effort to Tax Crypto Transactions
Nigeria’s new cryptocurrency regulations mark a shift from prohibition to structured oversight, introducing taxation, licensing and increasing compliance costs for digital assets businesses, especially startups. Licensing requirements and taxation may push smaller firms out but the regulatory clarity could attract institutional investors, boosting industry growth.
Central Gaming Bill Passes Second Reading
Following the recent Supreme court ruling invalidating the country-wide application of the National lottery Act, on grounds that the regulation of gaming and lottery activities is not within the exclusive legislative powers of the federal government, the House of representatives have introduced a Central Gaming Bill, seeking to harmonize the regulatory framework for online gaming and lottery activities. The bill attempts to restore the federal government oversight over gaming and lottery activities.
CBN Releases Guidelines for the Management of Dormant and Inactive Accounts
The Central Bank of Nigeria in its new Guidelines has mandated financial institutions to implement controls to prevent unauthorized use of dormant accounts, publish details of dormant accounts, and also transfer funds in dormant accounts to a CBN maintained central account, with the depositor’s right to reclaim the funds at any given time. While aimed at preventing fraud and other illicit purposes, the guidelines also raises significant data privacy concerns with regards to the publication of details of account holders, in addition to the additional administrative costs that come with notification of dormant account holders and publication of their account details.
CBN Orders Resignation of Bank Directors with Non-Performing Loans
The Central Bank of Nigeria has directed the immediate resignation of directors of banks with non-performing insider loans. This comes as part of the CBN’s initiative to strengthen corporate governance, reduce unethical lending practices and ensure more robust credit risk management practices by financial institutions.
Federal High Court Affirms FCCPC’s Multi Sectoral Jurisdiction
The Federal High court has affirmed the Federal Competition and Consumer The Federal High court has affirmed the Federal Competition and Consumer Protection’s (FCCPC) jurisdiction over competition and consumer protection practices across all sectors. This came as a turnout of a suit by a shareholder of telecom company, MTN, who sought to quash the commission’s investigation into the affairs of MTN. The decision of the court has however further strengthened and affirmed the powers of the FCCPC.
Meta in fresh lawsuit Over Privacy Violations
Femi Falana, a Nigerian human rights activist has instituted a fresh lawsuit against Meta over privacy violations, alleging that the company allowed its platform to be used to broadcast a deceptive advertisement portraying him as having prostatitis, a condition he claimed he has never had, with the advert containing his picture, name and voice. With the suit still pending in court, the case presents a very critical question of whether there is a connection between defamation claims and privacy rights. It’s also a wake up call particularly for social media outlets to take more proactive steps against the broadcast of deceptive posts on their platforms.
Flutterwave Considers Possible NGX Listing
The Nigerian government has pledged to support Nigerian-led African Unicorn, Flutterwave, in its recent plans to be listed on the Nigerian exchange limited. The listing could serve as a significant boost for the Nigerian capital markets and set a precedent for other home-grown fintechs in the country to follow.
New NIBSS reports indicate surge in fraud incidences
The Nigeria Inter-Bank Settlement System (NIBSS), in its latest reports, has indicated an increase in the rate of fraud incidences, with a total of about 52.26 billion lost to fraud activities in the year 2024, a figure representing an increase of about 200% from what was recorded in 2023. This presents a need for financial institutions especially, to implement stronger fraud prevention measures, which may range from stronger identification and authentication measures, stronger transaction monitoring measures and leveraging behavioral analytics amongst others.
Across Africa: Welcoming Innovation While Addressing Challenges
Airtel Money under Probe by COMESA
The Common Markets for Eastern and Southern Africa (COMESA) Competition Commission has commenced investigations into the activities of Airtel Money, over allegations of hidden charges and failure to disclose foreign currency exchange rates for their cross-border transactions. While the commission is yet to reach any decision, these allegations, again, underscores the importance of upholding consumer protection practices, including ensuring transparency, customer right to information and avoidance of deceptive practices.
Kenya Central Bank to Crack down on Commercial Banks over Lending Rates
Following a recent directive from the Kenya Central banks directing commercial banks to implement a reduction in their lending rates in line with the Risk-based Credit Pricing model, Commercial banks in Kenya have started implementing a reduction in their lending rates. Reports indicate that the CBK has started embarking on on-site inspection of commercial banks to ensure compliance. From the reports of the CBK Monetary Policy Committee, the goal of the CBK is to ensure greater access to credit across different sectors of the economy.
Ghana’s NIA to Integrate National ID with Financial Service Credentials
Ghana’s National Identification Authority has commenced efforts towards integrating the Ghana Card with financial services credentials such as mobile money and bank accounts to create a single identification, thereby simplifying financial transactions and documentation. This move could potentially strengthen anti-money laundering and Know your customer controls for financial institutions by linking transactions to verified identities. On the flip side, centralizing identity and banking functions raises privacy and cybersecurity risks, as a single data breach could expose both personal and financial information.
Ghana Unveils Plan to Launch e-Cedi in 2025
Ghana’s Central Bank has announced plans to launch the e-cedi, a central bank digital currency by 2025. The goal of the initiative is to enhance digital payments, improve financial inclusion and reduce cash dependence.
Kenya Revenue Authority’s Push to Integrate with Banking Systems Meets Huge Resistance
While the Kenya Revenue Authority (KRA) has intensified efforts towards integrating their systems with banking institutions to allow for real-time access to transaction records for the purpose of monitoring tax compliance and streamlining revenue collection process, has met huge resistance from banks, who decried the initiative could occasion consumer data leaks and breaches.
South Sudan to Launch First National Instant Payment System
In partnership with AfricaNenda, the Bank of South Sudan (BoSS) is set to launch a national instant payment system, enabling secure, real-time, and cost-effective transactions across various players in the financial ecosystem. This initiative aligns with the broader trend of payment system modernization across Africa, where 26 countries have already implemented instant payment systems, while 27 others are in the process of launching theirs.
Ghana and Rwanda Kickstarts Fintech Passporting System
The Bank of Ghana and National Bank of Rwanda have signed a memorandum of understanding to create a fintech passporting system, allowing businesses to seamlessly facilitate cross-border payments across these territories. This marks a landmark achievement for the continent, and could significantly set a precedent for more financial integration activities within the African markets.
Nigerian Startup, Startbutton Expands to Seven Francophone Countries, Easing Regulatory Compliance for Businesses
A Nigerian Norrsken backed startup, has expanded into seven francophone countries. This expansion is significant because it enables businesses to enter these new markets and accept local payments without establishing physical offices. By acting as a Merchant of Record, Startbutton manages local compliance, currency conversions, and payment processing, allowing companies to navigate cross-border complexities associated with business expansion into these jurisdictions.
Across the World
Bybit Suffers Cybersecurity Breach, Resulting in Largest Crypto Heist in History
Global crypto currency exchange, Bybit has suffered a major cybersecurity breach leading to a loss of about $1.5 billion dollar worth of crypto assets, mostly in ethereum. The breach seemed to have also occasioned a drop in the value of ethereum, by as much as 4%, within hours from when the breach was announced. The initial incident report suggests the threat actors exploited a vulnerability in their third party wallet provider. This underscores the need for greater third party risk management in modern financial services.
California Considers New AI Bill
Following the passage of the European Union Artificial Intelligence (AI) Act, countries globally have continued to intensify efforts towards the development of regulatory frameworks for the regulation of Artificial Intelligence. Against this backdrop, a new Artificial Intelligence bill has been introduced in California, seeking to prohibit algorithm discrimination and placing greater requirements on AI developers and innovators. This follows previous failed attempts to introduce similar bills. If successful, the bill could set a better framework for the promotion of ethical AI in the state.
US SEC to Change its Digital Assets Oversight Approach
The United States Securities and Exchange has indicated a change in its approach to the regulation of digital assets, following the replacement of the Commission’s Crypto Assets and Cyber Unit with the Cyber and Emerging Technologies Unit. This move aligns with the broader approach by the commission to make a shift from targeting crypto industry players to broader cybercrimes issues and general issues associated with retail investors, regardless of the industry.
Philippines Exits FATF Greylist
After about four years of being added to the Financial Action Task Force (FATF) grey list, the FATF has announced the exit of the Philippines from the grey list. The FATF announced that this move was due to the country’s improvement in its Anti-Money Laundering and Countering of Terrorism framework. This move offers greater potential for its financial services industry, as it is expected to reduce compliance barriers associated with cross-border transactions and also create an investor friendly environment for the industry.
Swiss Bank Unveils Tokenized Gold Product
Switzerland’s largest bank, Union Bank of Switzerland, has commenced testing for its new tokenized gold product, UBS Key-4 gold. The product is being tested on ethereum layer 2 scaling solution ZKsync. It allows users to buy and sell units of gold on-chain, with features including, secure storage, deep liquidity and optional delivery.
India’s IFSCA Unveils Consultation Paper on Regulatory Approach Towards Tokenization of Real-World Assets
With the European Union Markets in Crypto Assets (MiCA) Regulations already setting a precedent for the regulation of tokenized real-world assets (RWAs), the India International Financial Services Centre Authority (IFSCA) has commenced significant efforts towards following suit with the publication of its Consultation paper on the Regulatory Approach towards tokenization of RWAs. While the institution has called for public comments on the consultation paper, this could indicate a possible framework for the regulation of RWAs.
Crypto Scoop
States in the US Move to Establish Bitcoin Govt Reserves
About 15 states in the United States are considering legislation to establish a bitcoin reserve.. While these developments seem to have been largely influenced by Bitcoin’s potential of hedging against inflation, as it prices often fluctuate independently from fiat currencies, there are still concerns as to the workability of the initiative, given the price volatility, liquidity challenge and market manipulation risks associated with cryptocurrencies.
Central African Republic President Launches Memecoin
Following the adoption of bitcoin as a legal tender earlier in 2022, the president of the Central African Republic (CAR) has announced the launch of a new memecoin, known as $CAR. Experts have however expressed fear as to the implications of this move, given the high volatility associated with memecoin, with fears that this could be another pump and dump scheme.
US SEC Clarifies Memecoins are not Securities
The United States Securities and Exchange Commission has clarified the status of memecoin as not qualifying as securities under the securities law. The regulator maintained that memecoins investments are not based on any structured enterprise or common investment and there is usually no expectation of profit associated with the scheme, given that they are largely based on speculative trading and market sentiments, thereby falling short of the Howey test requirements for classifying assets as securities. Going forward, while this ruling might mean less stringent regulatory requirements for memecoin, investors must still exercise caution as a lack of SEC oversight means little or no investor protection, for an asset that is largely regarded as purely a pump and dump scheme.
SEC to Drop Law Suit Against Coinbase
American cryptocurrency exchange, Coinbase has announced that the Securities and Exchange Commission (SEC) has agreed to drop its lawsuit, filed since 2023, against the crypto giant, over allegations of operating an unlicensed securities exchange, broker and agency. Again, this appears to indicate the gradual shift towards deregulation of the cryptocurrency industry, in line with the objectives of the Trump administration.
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