Nigeria Inter-Bank Settlement System (NIBSS) recently directed banks to delist non-deposit payment service providers from the instant payment (NIP) outward transfer channels.

The directive was given in a circular dated December 7, 2023, and signed by Ngover Ihyembe-Nwankwo, executive director, business development, NIBSS.

In the circular, NIBSS noted that the directive seeks to address regulatory concerns regarding non-deposit-taking financial institutions (NDTFIs) holding customer funds.

However, the affected financial institutions are not restricted from receiving inward transfers.

List of financial institutions affected with NIBSS directive?

According to the circular the non-deposit taking financial institutions affected include Switching Companies (Switches), Payment Solution Service Providers (PSSPs) and Super Agents (SA).

NIBSS told the banks: "The listed beneficiary institutions on your NIP funds transfer channels contravenes the CBN Guidelines on Electronic Payment of Salaries, Pensions, Suppliers and Taxes in Nigeria dated February 2014.

“For clarity, Switches, PSSPs and SAs may process outward transfers as inflows to banks but are not to receive inflows as their licenses do not permit them to hold customers’ funds.

“Consequent on the above, kindly delist all switches, PSSPs and SAs from your NIP outward transfer channels only (not inwards).”

Opay, Paga, Palmpay react

Following the announcement there some reports had mentioned fintechs such as Kuda, Opay, Palmpay, and PiggyVest as some of the companies affected. In different press statements, the fintechs have come out to deny the reports of being affected by the announcement.

One of the reactions posted on X by Tayo Ovioso, chief executive officer (CEO), Paga, reads: “My attention was drawn to articles wrongly stating Paga is affected by the notice to remove PSSPs from receiving transfers.

“Paga is a licensed Mobile Money Operator, which allows us to hold deposits, unlike PSSPs. As you can see from the list, Paga is not on there.”

Similarly, Opay assured customers that the firm is also not included in the restriction. The company said in a statement posted on X.

“We wish to state that OPay is not affected by the recent circular published by NIBSS. The focus is on Payment Service Solution Providers, Switches and Super Agents.

“OPay is a Mobile Money Operator (MMO) licensed by the CBN and insured by the NDIC. Your funds are safe and secure with OPay.”

Palmpay also wrote: "Please disregard any false information on the NIBSS notice, as we are committed to ensuring the utmost security of your funds."

Here is a full list of companies ban from electronic transfer by NIBSS

Xpress payments

Accelerex Network

Itex Integrated Services Limited

Innovectives Kesh

Flutterwave Technology Solutions Limited

Interswitch Limited

First Apple Limited

3Line Card Management Limited

Paystack Payments Limited

Team Apt Kadick Integration Limited

Venture Garden Nigeria Limited

Arca Payments Company Limited

QR Payments Cyberspace Limited

Vas2nets Limited

CrowdForce Microsystems Investment and Development Limited

Bud Infrastructure Limited

Koraypay Capricorn Digital NetApps Technology Limited

SPay Business Yello Digital Financial Services

Nomba Financial Services Limited

Woven Finance

Paysure Technologies Limited

Leadremit Limited

Habaripay Irofit Technologies Limited

Nip Virtual Bank

NibssUSSD Payments