Nigeria is the largest country in Africa in terms of population and nominal Gross Domestic Product, GDP; therefore, it is easy for Nigeria to be home to some of the most formidable financial institutions in Africa. The new generation of Nigerian banks led by Access, GTB and Zenith are emerging as dynamic players in the regional markets.
In fact, the Nigerian financial system has been metamorphosed and revolutionized due to the increasing use of digital technology. Some of the latest trends in this sector include digitization, mobile and SMS banking, payment services, artificial intelligence or chatbots for customer service, fintech companies and exclusively digital banks. These have ensured that these banks are continually on their toes in terms of competition and of course more efficient.
In an African Business publication – “Africa’s Top 100 Banks 2020: West Africa and Central Africa”, Nigeria’s Zenith Bank stands as one of the best; Access Bank won Banker of the Year at the African Banker Awards; and First Bank always remaining strong in terms of capital base. Of the top 20 banks on this list, 13 Nigerian commercial banks were featured.
The main legislation that regulates and directs the affairs and operations of banks in Nigeria is the Banks and Other Financial Institutions Act, which gives the Central Bank of Nigeria the power and authority to supervise and regulate the affairs of all banks and institutions. financial. The Central Bank of Nigeria is the central bank and highest monetary authority of Nigeria established by the CBN Act of 1958.
As of 2021, there are a minimum of 41 Nigerian banks, including commercial banks, interest-free banks, microfinance banks, online-only banks, and commercial banks. These banks are classified according to their respective authorization. Of these numbers, only a few commercial banks are internationally licensed. These include: Access Bank Plc, Fidelity Bank Plc, First City Monument Bank Limited, Guaranty Trust Bank Plc, Union Bank of Nigeria Plc, United Bank for Africa Plc, Zenith Bank Plc, CitiBank Nigeria Limited and EcoBank Plc; while others are regional or national.
Opening a business bank account in Nigeria as a foreigner is easy as long as all the compliance requirements are met. Although each of these banks has their individual policies regarding bank account opening requests, however, the basics for all of them include the following:
1. Duly incorporated Nigerian company with evidence of registration with the Corporate Affairs Commission (CAC). This is perhaps the most important document and the first requirement in the process of opening a bank account. The incorporation documents must show, among other information, the name of the company, the number and date of incorporation, the registered business or operating address, the tax identification number, the personal data of the directors and shareholders or beneficial owners, and the nature of the business.
2. Notarization of Documents. Banks will require non-Nigerian directors and shareholders or beneficial owners to provide a notarized copy of external documents presented to them, such as identification documents, for example, national passport data page and incorporation document of a foreign company that appears as a shareholder or final beneficiary.
3. Bank Verification Number (BVN). The BVN is a unique 11-digit identity for every individual in the Nigerian banking industry. As a legal requirement, all directors (and sometimes shareholders and beneficial owners) listed in the incorporation documents must be registered with the BVN. There are BVN enrollment centers around the world that non-Nigerian residents can visit to apply for BVN.
4. Proof of registered or operating business address. Companies must submit a copy of proof of the company’s place of business. Acceptable documents include a utility bill (not more than 3 months old) from the business address or lease/rental agreements.
5. Board Resolution and Compensation Letter. The bank will request a resolution of the meeting signed by at least two Directors or a Director and the Secretary of the Company. This is an excerpt from your board meeting stating that an account will be opened at the bank and a certain level of control will be given to certain persons, directors or signatories.
6. Expatriate Residence Authorization and Combined Immigration Card (CERPAC). Foreigners listed as bank account signatures must possess a valid Nigerian residency permit. CERPAC are valid for a minimum of one year and are renewable. Some foreigners would prefer to appoint a local director as a signatory of the bank subject to certain resolutions while the foreigner takes control of Internet banking.
7. References from two Nigerian companies with existing bank accounts. It will need to be filed by two Nigerian companies operating a business bank account in any of the Nigerian banks. Your presenters are supposed to be well known to you and can vouch for their ability and reputation.
8. Registration with the Normalized Control Unit against Money Laundering (SCUML). The agency is responsible for monitoring, supervising and regulating the activities of Designated Non-Financial Institutions (DNFIs) in accordance with the Money Laundering (Prohibition) Act 2011 ML(P) Act and the Prevention of Terrorism Act (PTA). ) from 2011 .
9. Initial Bank Deposit. Most banks have a minimum account opening deposit; that is, the minimum amount of funds that must be deposited in the account at the time of opening to ensure that the account is active. Typically, a portion of these funds will be debited to take care of verification lookup and issuance of checks and bank tokens, if applicable.
How long does it take to open a business bank account in Nigeria?
Once all required paperwork is completed, and depending on how quickly the bank is able to verify all submitted information, some banks may proceed to open your bank account within 24 to 72 hours while the bank account remains inactive pending when they complete the checks. Verifications can take two weeks or more depending on the complexity of the process. You can open a local currency account (Nigerian Naira) and accounts in other international currencies such as British Pounds or US Dollars. Opening a foreign currency account will allow funds to be transferred across borders.
It is also standard practice that you are assigned an Account Manager, Account Officer or Relationship Manager who will be responsible for following up on the account opening process, managing your accounts with the bank and assisting you anytime you need assistance. with the bank while your bank account is in use.
Can you open a business bank account in Nigeria without traveling or being a resident?
Yes, talk to your adviser about your upcoming Nigerian company formation and opening a bank account.