This information is courtesy of Advocaat Law Practice in Lagos, Nigeria.
Below is a summary of the information contained in recent circulars issued by the Central Bank of Nigeria.
Automation of Form NXP on the Trade Monitoring System (TED/FEM/FPC/GEN/01/003).
The CBN issued the above circular to all authorized dealers, Nigerian Customs Service (NCS), pre-shipment
inspection agents and the general public notifying them of the automation of Nigerian Export Proceeds (NXP)
Form from October 31, 2019, the e-form NXP will replace the hard copy Form ‘NXP’ for commercial exports (Oil &
Gas and Non-Oil). The e-form ‘NXP’ application is a mandatory document that must be completed by all exporters
for shipment of goods outside Nigeria. The CBN also mandates exporters to obtain a valid Tax Identification
Number (TIN) from the Federal Inland Revenue Service (FIRS)/Joint Tax Board (JTB) as this will be a prerequisite
for customers to access the Trade Monitoring System for e-form ‘NXP’ application.
The Trade Monitoring System for e-form ‘NXP’ application can be accessed at www.tradesystem.gov.ng.
Revised guidelines for the registration of cash-in-transit and currency processing companies (COD/DIR/GEN/INM/13/132).
The CBN’s revised Guidelines for the Registration of Cash-In-Transit (CIT) and Currency Processing Companies
(CPC) (Guidelines) for the registration of cash-in transit and currency processing companies in Nigeria is in
furtherance of the circular on “Notice to Companies Providing Currency Sorting and Distribution Services and
Deposit Money Banks providing these Services for themselves or other Banks in Nigeria”, earlier released in 2009
by the CBN. As a result of the Guidelines, all entities that engage in or intend to engage in currency distribution
and/or currency processing services in Nigeria, either for themselves or for other Bank(s) must register with the
CBN. In addion to other registration requirements, prospective cash –in-transit and and currency processing
companies (CPC) companies must have a minimum share capital of N1 billion for National CIT and N500 million
for a Regional CIT.
Furthermore, companies who intend to provide both CIT and currency processing services are required to meet
all the requirements for registration as specified under CIT and CPC Guidelines. They are required to have a
minimum share capital of N4.0 billion whilst companies registered to operate both Regional CPC and CIT shall
have a minimum share capital of N2.5 billion. Banks desirous of providing currency processing and distribution
services can jointly (two or more banks) float a subsidiary company which must meet the registration
requirements for CIT and CPC and be subject to the regulatory and supervisory framework of the CBN.
For addional informaon on the circular, please refer to:
hps://www.cbn.gov.ng/Out/2019/CCD/Revised CIT and CPC Guidelines 2019.pdf
Implementation of the cashless policy (PSM/DIR/GEN/CIR/01/016).
The CBN had by a circular exempted some institutions from the cash less policy which required that deposits and
withdrawals above N500,000 (Five Hundred Thousand Naira) for individuals and N3,000,000 (Three Million
Naira) for corporate entities on bank account attract additional charges. The exempted institutions are:
a) Revenue generating accounts of the Federal, State and Local Governments;
b) Embassies, Diplomatic Missions, Multilateral Agencies, Aid Donor Agencies in Nigeria, Ministries,
Departments and Agencies of Government (revenue collection only);
c) Mobile Money Operators (Float accounts only); and
d) Micro-finance Banks (MFBs) and Primary Mortgage Institutions (PMIs) accounts with DMBs.
However, with effect from March 31, 2020, the above instuons will no longer be exempted from CBN’s cashless
policy.
For addional informaon on the circular, please refer to:
hps://www.cbn.gov.ng/Out/2019/PSMD/Implementaon of the Cashless Policy.pdf
Regulation for the operation of indirect participants in the payment system (PSM/DIR/CON/CWO/02/091).
The CBN released a Regulation for the Operation of Indirect Participants in the Payments System (the Regulation), which will take effect from 11 November, 2019. The Regulation applies to indirect participants in the payment
system and it is aimed at setting out the procedures for effective integration of indirect participants in the
payments system in Nigeria, standardizing the operation of indirect participants in the payments system,
providing mechanism and framework for the clearing, settlement of indirect participants payment instruments
through the direct participating banks and strengthening indirect participants for effective contribution to digital
financial services in Nigeria.
Indirect participant refers to a licensed deposit-taking institution which is a non clearing financial institution but
settles its payments obligations through direct participating banks. For an institution to qualify as an indirect
participant, such institution is expected to have a satisfactory risk-based rang from the CBN and secure a leer
of recommendation from its direct participating bank duly signed by the Chief Risk Officer and an Executive
Director of the direct participating bank; and must comply with the Nigeria Uniform Bank Account Number
(NUBAN) Standards.
For addional informaon on the circular, please refer to:
hps://www.cbn.gov.ng/Out/2019/PSMD/Circular and Regulaon for the Operaon of Indirect Parcipants in
the Payments System (002).pdf
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].
Inaugural United Airlines Direct Flight From New Jersey Lands in Cape Town
The inaugural United Airlines direct flight from New Jersey’s Newark Airport to Cape Town International Airport landed at 6pm on Monday amid much pomp and ceremony.
The ultra-long-haul flight sees the airline returning to Africa – United last flew to Africa via its Houston to Lagos route, which was discontinued a few years back – with plans to operate three weekly seasonal, non-stop flights between Newark and Cape Town until March 25 next year.
Finance and Economic Opportunities MEC David Maynier said: “The United States is a key tourism and business market for the province, and we look forward to welcoming United’s customers to Cape Town and the Western Cape.
This new service will open up the US and North American markets to opportunities in the Western Cape, and significantly contribute towards growing our tourism sector and stimulating economic growth in the Western Cape.
United’s regional managing director of sales, Bob Schumacher, said: “Our new service […] will provide our business and leisure customers with a seamless and more convenient way to travel between South Africa and North America, and more immediate access to everything the Americas has to offer.”
Wesgro chief executive Tim Harris said: “The new route will enable new and expanded economic opportunities on both sides of the Atlantic.”
The Boeing 787-9 Dreamliner aircraft features 48 seats in United Polaris business class, 88 seats in Economy Plus and 116 seats in United Economy.
Meanwhile, Cape Town Air Access received the Overall Winner Award for the second consecutive year at the annual Routes Africa 2019 Awards in Mombasa, Kenya last week.
Cape Town won three awards at the ceremony, including Best Airport in Africa in the 4-20 million passenger category; Destination Marketing award for Cape Town Air Access; as well as the Overall Routes Africa award.
Cape Town Air Access is a partnership between the City, the Western Cape Government, Airports Company SA, Cape Town Tourism, Wesgro and South African Tourism, which aims to land more direct routes into Cape Town International Airport.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], BlogDeBanderas [2].
Our Key Takeaways: Home Affairs Round-table in Cape Town
The British Chamber of Business in Southern Africa (BCBSA) was invited by the ANC’s Progressive Business Forum, which you can read more about here, to participate in a recent engagement with the Minister (Aaron Motsoaledi) and Director General (Thulani Mavuso) of the South African Department of Home Affairs.
The round-table took place at the Taj Hotel in Cape Town, and the Chamber was represented by our very own Lynn Mackenzie – Relocation Africa’s Immigration Lead – who was eager to engage with the Minister and DG.
The Minister discussed each of the main South African visas applied for – Business, Critical Skills, Intra-company Transfer, Corporate, and General Work – and was open to comments from attendees throughout. On the matter of Business Visas, it was noted that the various departments involved seem to be working well together, with the Department of Trade and Industry performing its due diligence.
Concerningly, consensus among those at the meeting was that there is increasing inconsistency between the Act and regulations, and their implementation, especially in overseas missions.
The transition to permanent residence was a hot topic, with practitioners insisting the process should be made easier. Many who move to South Africa still find themselves stuck in limbo, having to renew visas, while being under the impression they are on the path to gaining permanent residency, which brings with it a host of benefits, and allows the individual to feel more entrenched within South African society – something which the DHA assumedly has an interest in.
The Critical Skills visa list from 2014 is currently being updated, however the attendees’ experience was that the system is already in transition, with the new list being implemented in practice. The DHA did not comment on this matter. It is expected that the Department of Higher Education will give the DHA the new list by March 2020, however DHA has been vague about timelines up to this point. We will endeavour to share more information as and when we receive it.
The DHA claimed during the meeting that turnaround times for visas are an average of 4 to 8 weeks, however attendees noted they have not experienced this. We are hoping that waiting times improve in the new year, as the new systems officially roll out. Attendees were also happy to hear that there is frequent engagement and communication between the Home Affairs, Labour, and Trade and Industry departments.
Practitioners at the meeting expressed the fact that rejections are the highest they have seen in recent years and asked for data relating to this matter. The DG staged that data is available for turnaround times and percentage of applications approved. It was also noted that General Work Visa applications are rarely successful, and people are therefore refraining from applying for them. One attendee suggested to the DHA that this category is abolished entirely.
Finally, some meeting members conveyed their dissatisfaction with the bureaucracy in dealing with the DHA, saying that administrative procedures are, at times, excessively complicated. It is our hope that the DHA will cut down on this element of its practices and be more flexible in the coming years.
To end off the meeting, the Minister said there would be follow-up meetings, and regular engagement with DHA, which we greatly appreciate.
We would like to thank the Chamber for providing us with the opportunity to attend this valuable engagement session and thank Minister Motsoaledi and DG Mavuso for taking the time to hear and provide feedback in these kinds of round-table meetings. Relocation Africa looks forward to what 2020 will bring in the South African immigration space.
Relocation Africa offers a range of Immigration-related services across Africa. To find out more, click here.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].
The Africa Report 2019: How South African Banks Are Performing
South Africa is ‘a marketplace without boundaries’, says PwC, and new niche players are limbering up to compete with the country’s top banks by offering digital, lower-cost financial services.
A slew of new banks and tech-based financial services are shaking up the industry in South Africa. New competitors to the so-called ‘big four’ – Standard Bank (#2), Absa Bank (#5), Nedbank (#7) and First National Bank (FNB, #14) – range from the stateowned Postbank to insurance group Discovery, TymeDigital (a venture by the Commonwealth Bank of Australia and Patrice Motsepe’s African Rainbow Capital) and former FNB chief executive Michael Jordaan’s Bank Zero.
These are joined by retailers (mobile money from Shoprite Money) and agricultural groups (Afgri, which bought Bank of Athens’ South African operations). Many of those firms would like to grow like Capitec (#44, see profile). It gave South Africa’s well-entrenched major banks a wake-up call by disrupting their long-held oligopoly as a leaner, meaner and faster-growing operation. But it took Capitec, which was launched in 2001, some years to become a major force in the industry.
A recent PwC report says the South African financial services industry is increasingly ‘a marketplace without boundaries’, where banks are being challenged ‘by digital solutions with lower-cost models’. It adds that the market share of the incumbents will likely be squeezed by innovative new entrants unless banks implement strategies ‘to remain relevant in the future banking market landscape’.
FNB has moved successfully to a more digital banking model, while other large banks are trying to follow suit. The new financial services models are not centred around becoming one of ‘big four’, whose services range from retail banking to commercial and investment banking with a plethora of additional services, from mortgage lending to large-scale merger and acquisition capability.
Wessel Badenhorst, an analyst in the financial services sector at 36ONE Asset Management, tells The Africa Report that it is important to keep in mind that most of the challenger banks offer limited product suites: “Most do not offer business banking or offer limited retail products, sometimes because regulatory hurdles prevent them from competing in these markets. TymeDigital, for example, offers only transactional banking, and comments from [insurer] Discovery suggest its bank will have limited lending products, at least initially.” So far, the big banks continue to brush off the threats and have weathered some difficult years.
PwC’s analysis indicates that they grew earnings 5.2% in 2017, although core earnings – operating income minus operating expenses – improved by only 3.6%. Earnings were helped by a 10.6% decline in the second half of the year in bad-debt charges.
Remarkable resilience
Credit growth remained muted ‘given elevated levels of political and economic uncertainty, low GDP growth and subdued levels of household and business confidence,’ PwC says. In addition, retail asset-led businesses including instalment sales and vehicle finance showed strain, while corporate credit demand declined.
The Reserve Bank said that total banking sector assets increased 5.7% year-onyear to more than R5tn ($378.8bn) at the end of 2017. The central bank added that the 12-month moving average operating profit growth rate decreased throughout 2017, mainly due to a decline in the growth of net interest income and an increase in operating expenses.
Investors jittery
Operations in the rest of Africa offer growth for some of the players, but generally earnings growth in the medium term is dependent on cost savings, says Mergence Investment Managers’ head of listed investments, Bradley Preston.
There is still nervousness among investors in South Africa, spurred by the downfall of some major companies, including Steinhoff.
For banks, President Cyril Ramaphosa’s announcement of land expropriation without compensation is another potential challenge. “How land expropriation is executed is obviously important to the banks as lenders against property and lenders in the agricultural sector,” Preston concludes.
To read the full report, click here.
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email marketing@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].
Highlights from Recent Circulars Issued by the Central Bank of Nigeria
This information is courtesy of Advocaat Law Practice in Lagos, Nigeria.
Below is a summary of the information contained in recent circulars issued by the Central Bank of Nigeria.
Automation of Form NXP on the Trade Monitoring System (TED/FEM/FPC/GEN/01/003).
The CBN issued the above circular to all authorized dealers, Nigerian Customs Service (NCS), pre-shipment
inspection agents and the general public notifying them of the automation of Nigerian Export Proceeds (NXP)
Form from October 31, 2019, the e-form NXP will replace the hard copy Form ‘NXP’ for commercial exports (Oil &
Gas and Non-Oil). The e-form ‘NXP’ application is a mandatory document that must be completed by all exporters
for shipment of goods outside Nigeria. The CBN also mandates exporters to obtain a valid Tax Identification
Number (TIN) from the Federal Inland Revenue Service (FIRS)/Joint Tax Board (JTB) as this will be a prerequisite
for customers to access the Trade Monitoring System for e-form ‘NXP’ application.
The Trade Monitoring System for e-form ‘NXP’ application can be accessed at www.tradesystem.gov.ng.
Revised guidelines for the registration of cash-in-transit and currency processing companies (COD/DIR/GEN/INM/13/132).
The CBN’s revised Guidelines for the Registration of Cash-In-Transit (CIT) and Currency Processing Companies
(CPC) (Guidelines) for the registration of cash-in transit and currency processing companies in Nigeria is in
furtherance of the circular on “Notice to Companies Providing Currency Sorting and Distribution Services and
Deposit Money Banks providing these Services for themselves or other Banks in Nigeria”, earlier released in 2009
by the CBN. As a result of the Guidelines, all entities that engage in or intend to engage in currency distribution
and/or currency processing services in Nigeria, either for themselves or for other Bank(s) must register with the
CBN. In addion to other registration requirements, prospective cash –in-transit and and currency processing
companies (CPC) companies must have a minimum share capital of N1 billion for National CIT and N500 million
for a Regional CIT.
Furthermore, companies who intend to provide both CIT and currency processing services are required to meet
all the requirements for registration as specified under CIT and CPC Guidelines. They are required to have a
minimum share capital of N4.0 billion whilst companies registered to operate both Regional CPC and CIT shall
have a minimum share capital of N2.5 billion. Banks desirous of providing currency processing and distribution
services can jointly (two or more banks) float a subsidiary company which must meet the registration
requirements for CIT and CPC and be subject to the regulatory and supervisory framework of the CBN.
For addional informaon on the circular, please refer to:
hps://www.cbn.gov.ng/Out/2019/CCD/Revised CIT and CPC Guidelines 2019.pdf
Implementation of the cashless policy (PSM/DIR/GEN/CIR/01/016).
The CBN had by a circular exempted some institutions from the cash less policy which required that deposits and
withdrawals above N500,000 (Five Hundred Thousand Naira) for individuals and N3,000,000 (Three Million
Naira) for corporate entities on bank account attract additional charges. The exempted institutions are:
a) Revenue generating accounts of the Federal, State and Local Governments;
b) Embassies, Diplomatic Missions, Multilateral Agencies, Aid Donor Agencies in Nigeria, Ministries,
Departments and Agencies of Government (revenue collection only);
c) Mobile Money Operators (Float accounts only); and
d) Micro-finance Banks (MFBs) and Primary Mortgage Institutions (PMIs) accounts with DMBs.
However, with effect from March 31, 2020, the above instuons will no longer be exempted from CBN’s cashless
policy.
For addional informaon on the circular, please refer to:
hps://www.cbn.gov.ng/Out/2019/PSMD/Implementaon of the Cashless Policy.pdf
Regulation for the operation of indirect participants in the payment system (PSM/DIR/CON/CWO/02/091).
The CBN released a Regulation for the Operation of Indirect Participants in the Payments System (the Regulation), which will take effect from 11 November, 2019. The Regulation applies to indirect participants in the payment
system and it is aimed at setting out the procedures for effective integration of indirect participants in the
payments system in Nigeria, standardizing the operation of indirect participants in the payments system,
providing mechanism and framework for the clearing, settlement of indirect participants payment instruments
through the direct participating banks and strengthening indirect participants for effective contribution to digital
financial services in Nigeria.
Indirect participant refers to a licensed deposit-taking institution which is a non clearing financial institution but
settles its payments obligations through direct participating banks. For an institution to qualify as an indirect
participant, such institution is expected to have a satisfactory risk-based rang from the CBN and secure a leer
of recommendation from its direct participating bank duly signed by the Chief Risk Officer and an Executive
Director of the direct participating bank; and must comply with the Nigeria Uniform Bank Account Number
(NUBAN) Standards.
For addional informaon on the circular, please refer to:
hps://www.cbn.gov.ng/Out/2019/PSMD/Circular and Regulaon for the Operaon of Indirect Parcipants in
the Payments System (002).pdf
For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email info@relocationafrica.com, or call us on +27 21 763 4240.
Sources: [1], [2]. Image sources: [1], [2].