The Central Bank of Nigeria (CBN) has unveiled guidelines for licensing and regulation of payments system holding companies (PSHC), stressing that companies must exist as non-operating entities in the ecosystem.

The guideline is a follow-up to an earlier template on new license categorisation, which required companies with an interest in switching/processing and mobile money service to set up holding structures.

In an accompanying circular issued on Tuesday and signed by the Director, Payments System Management Department, Musa Jimoh, the CBN insisted that PSHC must maintain a minimum of two subsidiaries with a focus on switching and mobile money services.

The guideline covered broad areas such as licensing process/requirements, ownership, corporate governance, permissible/non-permissible activities and prudential regulation.

“For the purpose of this regulation, a PSHC is a company whose principal object clause include the business of a holding company set up for the purposes of making and managing equity investment in two or more companies, being its subsidiaries, which are payments service providers across the following categories Mobile Money Operations, switching/processing and payment solution services. “

The PSHC shall be non-operating, existing solely to carry out investment in approved subsidiaries without engaging in the day-to-day management and operations of subsidiaries,” the regulator noted in the new document.