The Exercise of Governor’s Power on Compulsory Acquisition of Land: A Case Study of Niger State Government V. FUT-MINNA | Mohammed Yahaya Pichiko

by Legalnaija | Apr 6, 2026 | Blawg

• Introduction:

The Land Use Act, 1978 represents a foundational reform in Nigeria’s land tenure systems, introduced to correct the structural, economic, and administrative challenges that existed before 1978. Its importance goes far beyond simple land regulation that reshaped the philosophy of land ownership, governance, and utilization in Nigeria. The Land Use Act was initially introduced with the intention of addressing land tenure systems the primary goal was to streamline and regulate land ownership, as well as to promote efficient land use, urban development, and economic growth. The Land Use Act (formerly called the Land Use Decree) was promulgated on 29^th of March 1978 to be exact. Former President Olusegun Obasanjo is to take the credit for being the man who made the Land Use Act an integral part of the constitution of the Federal Republic of Nigeria during the military regime before he eventually handed over to Alhaji Shehu Shagari led Federal Government. According to Chapter 202 of the laws of the Federation of Nigeria 1990, the Land Use Act, 1978 is an Act that vest all land compromised in the territory of each state (except land vested in the Federal government or its agencies) solely in the Governor of the State, who would hold such Land in trust for the people and would henceforth be responsible for allocation of land in all urban areas to individuals resident in the State and to organizations for residential, agriculture, commercial and other purposes while similar powers will with respect to non-urban areas are conferred on Local Government.

However, land is universally recognized as one of the most fundamental resources necessary for human existence, socio-economic development, and political stability and constitute the basis of shelter, agriculture, commerce, and infrastructure development in Nigeria. Land occupies a central position in the life of individuals and communities because it is not only an economic asset but also a cultural and social heritage passed from one generation to another. Because of its importance, the regulation, ownership, and control of land have always been critical issues in the legal and administrative systems of the country. Prior to the enactment of the Land Use Act, 1978 land tenure systems, Nigeria was characterized by a multiplicity of legal systems which were mainly customary law, received English law, and statutory legislation. Under customary law, which operated predominantly in the southern part of Nigeria, land was generally owned by communities, families, or individuals under a freehold tenure systems. Community heads or family leaders held land in trust for members of the group, and individuals could posses or use land based on customary rights recognized within the community. This system emphasized communal ownership and traditional authority structures in the allocation and management of land. In contrast, the northern region part of Nigeria operated under a different legal regime following the enactment of the Land Tenure Law of 1962  under this law, all land in Northern Nigeria was vested in the Governor, who held in trust for the benefit of the people.

(1) Concept/Definition of Ownership: can be defined as a state or fact of legal possession and control over property, which may be any asset, tangible or intangible. Ownership can involve multiple rights, collectively referred to as title, which may be separated and held by different parties. It also involves a collection of rights that can be transferred or lost, and it grants the owner the ability to make decisions about what is owned and to benefit from it.

According to Per, Muhammad Lawal Shuaibu, JCA (Pp 9-9 Paras F-F) in the case of Ikpok & Ors V. Udoh (2021) LPELR-55883  on the meaning of ownership as:

“Ownership is the state or fact of exclusive rights and control over property, which may   be any asset, including an object, land or real estate”

The judicial authority from the above is that for the fact Niger State Gov’t is claiming ownership of such landed property in Bosso Campus the law is trite that such ownership have to deals with legal rights, personal responsibility, economic theories, and philosophy view ownership which often used in well organized situation to mean taking responsibility in fostering individual freedom and societal progress.

(2) Concept of Right of Occupancy under Land Use Act, (1978): can be defined as a legal entitlements allowing individuals to possess, use, and inhabit a property, even if they do not own it, often granted by governments, these rights cover residential, commercial, or agricultural land for specific period. They include rights to exclusive use, while potentially allowing leasing or inheritance. Right of occupancy is a legal right to use, occupy, and posses land, typically granted by a government authority like the state or local government in Nigeria. It is an important step for securing interest in a property but is established by a Certificate of Right of Occupancy (C of O), Unlike a C of O a right of occupancy does not confer complete ownership and may have restrictions, such as limitations on transferring ownership, restrictive covenants or obtaining a mortgage without converting it to C of O.

  According to Martins Library Right of occupancy is the secondary form of land title, which exist under the Land Use Act does not make any positive as to the ownership or right of occupancy but, it does not make not inferentially or in negative way wholly and exclusively vesting the maximal title to land in the Governor under section 1 and go on in section 5 and 6 and in sub section 34 and 36 respectively to limit a right of occupancy the right which the Governor or local governments in land to any person, organization, or which any person , organization, whether individuals family community corporation otherwise own land all that they can have is the right of occupancy, which if granted by the governor anywhere in the state is called statutory right of occupancy and if granted by the local government by reason of customary user or occupation under section 36 is called customary right of occupancy.

From the foregoing, it’s critical clear that an individual or institution is only granted a right of occupancy i.e having the possession of the landed property, the title ownership of such property is with government has claimed by government of Niger State depending on some term and condition between the Bosso Campus (institution) with the government at a particular period of time. Although when right of occupancy is granted to an individual or institution by governor of a state such party or institution has 99 days before such expiration except such compulsory acquisition of Right of occupancy can only be revoked when such revocation will serve for public interest or purposes in compliance with the provision of section 28 of the Land Use Act, 1978.

2.0 Provisions of Land Use Act on Compulsory Acquisition of Land

The provision of section 28 of the Land Use Act is one of the most significant provisions regulating compulsory acquisition of land. It provides the legal authority for the government to revoke a right of occupancy granted to an individual or organization where the land is required for overriding public interest or where the holder breaches the conditions attached to the grant. The section therefore represents the statutory foundation upon which government acquisition of land is carried out under the Nigerian land tenure systems. Under the Land Use Act land is vested in the Governor of the state, who holds such land in trust for the benefit of the people.

According to the provision of Section 28/29 of Land Use Act, 1978

Provide this:

PART V

Revocation of rights of occupancy and compensation therefore

Section 28 Power of Governor to revoke rights of occupancy.

Section 29 Compensation payable on revocation of Right of occupancy by Governor in certain cases.

In the case of R.C.O & Ors V. RAINBOWNET LTD (2014) 5 NWLR PT. 1401 C.A 516

The court held thus:

The provision of section 28 of the Land Use Act contain comprehensive provision to guide the governor of the state in exercise of his vast power of control of land within his state particularly the power of revocation is that it must be shown clearly to be for overriding public interest.

The position implies that the Act provision has given a vast power to the Niger State Gov’t to take over a landed property by way of revocation of right of occupancy only when such compulsory acquisition is base on overriding public interest.

3.0 Exercise of Governor’s Powers on Compulsory Acquisition of Land

Governor’s Powers on compulsory land acquisition in Nigeria under the Land Use Act, 1978 and 1999 Constitution requires the acquisition to be for a “public interest,” with due notice served on the holder and prompt, adequate compensation paid. Additionally, the statutory procedure for acquisition must be followed, including serving notice on the property holder, and also property holders have the right to challenge the acquisition in court if these conditions are not met. The Governor’s Powers of compulsory acquisition of land under the Land Use Act is extensive but not absolute. The academicians emphasis that this power is subject to significant limitations, primarily the strict adherence to the procedure and purpose specified in the Act and the Nigerian Constitution.

3.0.1 Grounds for Exercise of Governor’s Power on Compulsory Acquisition of Land

(a) Subject to Public Interest: The governor can only exercise the power of compulsory acquisition when the purpose of the acquisition is for the benefit of the general public and not for private or personal gain. The Land must be taken for the purposes that promote public welfare, development, or government objectives that serve the community as a whole. One of the major circumstances where compulsory acquisition occurs in the public interest is for the provision of public infrastructure and development projects.

(b) Issuance of Notice: is a fundamental procedural requirements in the exercise of the Governor’s Power of compulsory acquisition of land under the Land Use Act, although the Governor has the authority to revoke a right of occupancy for overriding public interest, the law requires that such revocation must be properly communicated to the holder or occupier of the land through an official notice. This requirement is intended to ensure fairness, transparency, and compliance with due process in the acquisition of private land by the government.

(c) Compensation: is one of the most important legal safeguard provided to land owners or holders when the government exercise it power of compulsory acquisition of land. Under Nigeria land tenure systems, the governor has the authority to revoke a right of occupancy for overriding public interest the law recognize such revocation may cause loss or hardship to the land holder. Consequently, the law provides that person’s whose rights of occupancy are revoked are entitled to compensation for certain interest affected by the acquisition. Under section 28 of the Land Use Act, 1978 the Governor may revoke a statutory or customary right of occupancy for overriding public interest. However, once such revocation occurs, section 29 of the Act provides for the payment of compensation to holder or occupier of the land whose interest has been affected.

In the case of TS-Y LTD V. NWACHUKWU & ORS (2024) LPELR-62629 (SC)

The court held thus:

Section 28 (6) Provide that the revocation of Right of Occupancy shall signified under the hand of a public officer duly authorized in that behalf by the Governor and notice thereof shall be given to the holder.

The constitution assures affected individual a right of access to a court of law or a tribunal for the determination of their interest in the property and the amount of compensation payable, which was noted that this right should not be defeated by a mere technicalities such as limitations statutes in cases of delay compensation payment. In essence, the view highlights that while the Niger State Government holds the ultimate title to land under the Land Use Act, the exercise of the power to compulsory take over FUT-MINNA (Bosso Campus) it is heavily conditional i.e for the purposes of public interest. And if the Niger State Government went ahead to revoke the right of occupancy of FUT-MINNA without a proper notice or lay down procedures the act is going to undermine the rule of and the purported compulsory acquisition will be null and void by the court of law.

4.0 Distinguishing the Case Study of Niger State Government V. FUT-MINNA with other Judicial Authorities

In distinguishing the case of Orianzi V. A.G Rivers State (2017) 6 NWLR Pt. 1561 Pg. 224 (SC)

(a) Statement of Facts

Sometimes in 1981, the government of Rivers State offer sale of abandoned property known as plot 46, Diobu GRA phase Port Harcourt otherwise known as Obaji street. The appellant’s accepted the offer and pay deposit of 10,000,00 toward it total value an agreement evidence the sale was subsequently entered into between the appellant’s and the secretary to the government of Rivers State. After the agreement was registered at the Land Registry Port Harcourt the appellant’s was put into possession.

When the military took over power in 1983, the disputed property was confiscated. After then he was made to appear before justice Uwaifo special panel on recovery of public property in Lagos later the government of Rivers State appoint a Sanomi commission of enquiry to look into allocation of plot and abandoned property between 1st October 1979 and 31 December 1982. The commission recommended the disputed property to be retained as government quarters. The government accepted the recommendation by legal notice NO. 3 of 1986 published in official gazette of Rivers State NO. 9 volume 18 of 27 march 1986 that the appellant’s right over the property has been revoked. The property was retain by government for six months and was subsequently, sold to late Dr. Charles Dima the original 3rd defendant.

(b) The Ratio Decidendi in the Judgment

The court held thus:

“the purported revocation of the appellant’s title was not for any overriding public purpose which is sine qua non for revocation of the right of occupancy under section 28(6) of the Land Use Act and the acquisition of disputed for use as government quarters was mere smoke screen as government turn round only six months later to offer it for sale to another individual. The revocation was not preceded by actual notice deliver on the appellant’s and for such revocation given to it holder under section 28 and 44 of the Land Use Act.”

(c) Analysis: However, in my view the court in the above case do not hesitate to invalidate revocation of right of occupancy whenever a due procedure is not comply with. The law is trite that revocation of right of occupancy under the Land Use Act, 1978 on compulsory acquisition of land have to be for public purpose or interest.

Also, in the case of Stodie Venture Ltd. V. Aliemieyeseigha (2016) 4 NWLR Pt. 1502 (SC)

(a) Statement of Fact

The appellant’s institute an action against the respondent over the parcel of the Land the respondent do not denied the appellant’s purchase of the said land was allocated to them by the Government of Bayelsa State after the government compulsory acquire the land together with other for overriding public purpose. The respondent was governor of Bayelsa State then who exercise the power granted to him as governor of the state under Land Use Act and compulsory acquire the said land.

However, the allergen compulsory acquisition does not comply with statute enabling the Bayelsa State Governor to compulsory acquire land for public purpose. Rather then using the land for public purpose the respondent turn round and allocate same of the plot to his wife, the then first lady of Bayelsa State in their private capacity for private purpose.

(b) The Ratio Decidendi in the Judgment

The court held thus:

“The validity of acquisition in accordance with lied down principle of relevant law since 3rd respondent got title through purported revocation which is proof void by the plaintiff no government or individuals has any right to acquire land compulsorily and alienate or transfer it to another private individual for his or it private use”

(c) Analysis: Base on the above authorities, it become clear that the judicial attitude of the court on cases of revocation and compensation shows that court are at best to ensure revocation by the governor must follow laid down procedure and fulfill the ground thereof. More over the court are always keen to see that payment of compensation for revocation for public purpose should not only be sufficient in the eyes of the law but adequate to sustain the holder or occupier.

5.0 Findings

After careful study of the issue at hand the following are my findings:

1. The Holder of the Right of occupancy no longer enjoy security of absolutes possession of land, in the sense that some mischievous state governor’s or agency of government may, under section 28 of the Act, revoke the right of occupancy of any person under the guise of public interest.
2. The Land Use Allocation Committee, established under section 2(2)-(3) of the Act, do not exist in some state in Nigeria, which the Act, provide for outer clause, preventing any court of law from entertaining any case that has to do with adequacy of compensation.
3. The provisions of section 29 of the Land use Act and other related provisions appear to be inadequate to guarantee fairness and equity in acquisition process. In the first place the item listed as constituting public purpose are son extensive and flexible that the governor can easily manipulate them to defeat the interest of the title holder for reason that are largely not altruistic.
4. The Act generally reduced heavy cost of acquisition of land by the government, by restricting compensation to unexhausted improvement only, thus doing away with compensation for inconveniences and bare under-developed land.

6.0 Recommendation

From all the above, this work is able to come up with the following as recommendation that would help in curbing the issue of abuse of power and would create case in terms of land administration in Niger State and Nigeria at large.

1. It is recommended that a provision should be inserted in the Act to require hearing, before a judicial or quasi-judicial body, to determine the justifiability of the public purpose adduced by the Government for a purpose before the Governor can invoke his power of revocation under section 28(1) of the act.
2. The compensation is not payable by the state when certificate of occupancy is revoked because the holder or occupier breach the statutory provision which prescribed that and no alienation without consents of the state, equity demands that an owner of a factory site should be paid not only the replacements costless depreciation but also the loss of use of land for factory for unexhausted residue of his rights of occupancy.
3. Section 2(2) and 30 of the Land Use Act requiring disputes as to the amount of compensation payable under section 29 of the Act to be referred to the Land Use Committee, whose entire membership, is determined by the Governor, being contrary to the rule of natural justice to wit nemo judex incausa sua, should be amended by substituting the Land Use Committee provided for therein with the regular Magistrates Court or High Court. This will help to guarantee the independence and impartiality of the body saddled with the responsibility of determining the quantum or adequacy of compensation assessed payable under the Act. In furtherance to the above paragraph, I urged the governments to set up Land Allocation Committee, at both Federal and State level with enlarge powers to exercise the following:

• Initiating and processing application for land allocation, and approval by the Governor.
• Organizing public hearing determining merits and demerits of proposed revocation for public interest where necessary.

4. It is recommended that the section 29 of the land use Act should be amended to include a provision for compensation for bare land because a bare land has value of its own, sometimes running into millions of naira. Notwithstanding the fact that the radical title in land has been vested in the Governor, a person who lawfully acquired a piece of land say by way of a purchase with the consent of the Governor should be entitled to a refund of the purchase price or compensation equal to the value of the land at the date of the revocation. Provisions should also be made to allow compensation to a title holder in respect of other losses directly flowing from the compulsory acquisition (outside the value of actual development or improvement on the land) for example, compensation for loss of business and relocation cost.

7.0 Conclusion

In conclusion, the researcher tried to examined critically the power of the Governor to revoked right of occupancy and entitlement to compensation under the Land Use Act 1978. It’s safe to conclude that Land Use Act vested the State Governor with power of revocation of the land only on ground of overriding public interest and subject to the prompts payments. The Act also provided a laid down procedure upon which appropriate authority must have followed. It is part of the condition that a notice must be served to the rights holder by the appropriate authority. Where revocation is meant for private or personal interest such revocation is invalid, and the holder of the certificate must prove good title to the land before compensation could be awarded. In this respect therefore, where the holder of the certificate of occupancy breach any of the condition deem to have contained under section 10 of the Act or he is unable to prove good title of the land compensation will not be awarded.

______________________________________________________________

Full Name: Mohammed Yahaya Pichiko

Phone No: 07033412386

Email: mohammedpichikoyahaya@gmail.com

Hobbies: Reading & Research

Graduate of Common and Islamic Law, Bayero University Kano.

Thank you for enjoying.

Photo Credit: https://nzepro.com/land-acquisition-process-nigeria/

Custom Legal Trainings: Curated for Your Team’s Success 

by Legalnaija | Apr 2, 2026 | Blawg

Custom Legal Trainings: Curated for Your Team’s Success

At Lawlexis, we know that a “one-size-fits-all” approach doesn’t work for high-performing legal teams. Whether you are a forward-thinking law firm or a fast-paced corporate legal department, staying ahead of regulatory shifts and niche market trends is non-negotiable.

While many of our trainings are available on our YouTube and social media pages, the real transformation happens when the training is designed specifically for your objectives.

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Vacancy: Associate Counsel (Commercial Litigation)

by Legalnaija | Mar 31, 2026 | Blawg

Vacancy: Associate Counsel (Commercial Litigation)
Experience Level: 4-7 Years Post-Call litigation
Location: Dolphin Estate, Ikoyi, Lagos
Employment Type: Full-Time

Role
We are seeking an experienced Litigation Associate Counsel with a strong commercial law background to join
our firm. Applicant should be organized, smart, detail-driven, confident in Court and capable of handling
complex commercial disputes with minimal supervision.

Key Responsibilities
● Represent clients in commercial litigation matters before various Courts and tribunals.
● Draft, review, and file pleadings, written addresses, affidavits, motions and other legal documents.
● Conduct legal research and prepare well-reasoned opinions on commercial law issues.
● Manage case files, develop litigation strategies, and provide legal advisory services.
● Attend court proceedings, client meetings, arbitration sessions and settlement negotiations.
● Interpret laws, rulings and regulations to provide accurate legal guidance.
● Liaise with external Counsel, regulatory bodies and key stakeholders where necessary.

Requirements & Qualifications
● LL.B and B.L from accredited institutions.
● 4-7 years post-call litigation experience, with proven expertise in commercial law.
● Strong understanding of commercial transactions, contract disputes, regulatory compliance and
corporate litigation.
● Demonstrated ability to draft high-quality legal documents and manage cases independently.
● Excellent written and verbal communication skills.
● Strong advocacy and Courtroom presentation skills.
● Ability to work under pressure, manage deadlines and multitask effectively.
● High level of professionalism, integrity and attention to detail.
● A polished and well-groomed appearance and presence is required and an added advantage

Preferred Skills
● Experience with arbitration or alternative dispute resolution (ADR).
● Research proficiency and strong analytical ability.
● Client-facing skills and the ability to maintain strong professional relationships.

How to Apply
Interested candidates should send their CV and a short cover letter to litigationjobs2026@gmail.com with
the subject line: “Application – Associate Counsel (Commercial Law)”.

CRYPTOCURRENCY:- WHAT YOU NEED TO KNOW ABOUT CRYPTO/DIGITAL & VIRTUAL ASSETS BUSINESS LICENSING IN NIGERIA | Emmanuel Ifeanyi Ogbuka

by Legalnaija | Mar 25, 2026 | Blawg

Introduction:- Cryptocurrencies, blockchain-based payments,tokenized assets, and digital securities remain one of the most disruptive innovations in the world of 21st century finance, especially in Nigeria where it led to unprecedented levels of financial inclusion and truly borderless transactions, creating new business opportunities & possibilities as well as pushing the boundaries of decentralized banking & finance.

But these innovations also came with unprecedented levels of problems not seen in the field of compliance & financial/economic crimes , ranging from advanced methods of Terrorism-financing, the safe keeping of the financial proceeds of crime far beyond the reach of regulatory agencies, and major uninsured losses to victims of uncontrolled trading of highly volatile cryptocurrencies and tokens usually pegged to no real-world assets.

This necessitated the need for regulatory control of digital & virtual assets (including cryptocurrencies) as well as regulatory licensing & oversight of businesses engaged in digital & virtual assets services, which in Nigeria, falls under the jurisdiction of the Securities & Exchange Commission (SEC), charged by virtue of the Investments and Securities Act (ISA) 2025 & its updated SEC Rules On The Issuance, Registration & Custody Of Digital Assets 2022.

This article will be focused on highlighting:-

a). The classes of digital & virtual assets/crypto business licenses currently available in Nigeria.

b). The licensing process & requirements for these business licenses.

c). The cost & time implications of procuring these business licenses.

d). Alternative licensing options for techpreneurs seeking to engage in the business of rendering virtual & digital asset /crypto services in Nigeria.

What are the business licenses currently available for digital & virtual asset/crypto service providers in Nigeria?

The SEC currently provides the following business licenses for digital & virtual asset/crypto service providers in Nigeria:-

1. a) .Digital Asset Exchange (DAX) Licenses :- 

– A DAX is an online platform for the facilitation of trading in virtual and digital assets.

– A DAX is regulated by the Securities and Exchange Commission (SEC) and comes with a minimum share capital requirement of 2 (Two) Billion Naira.

b). Digital Asset Offering Provider (DAOP) Licenses :- 

– DAOPs are digital platforms licensed by the SEC for the purpose of serving as a platform for digital asset offerings in the form of ICOs or Initial Coin Offerings.

– DAOPs carry a minimum share capital requirement of 1(One) Billion Naira. 

c). Digital Asset Custodians (DACs) :- 

– DACs are companies licensed by the SEC to be engaged in the safekeeping of digital assets invested in ICOs in a manner similar to traditional Custodian companies.They come with a share capital requirement of 2(Two) Billion Naira.

d).“VASPs” or Virtual Asset Service Providers which are defined in the guidelines as platforms that conduct of behalf of other parties :-

1. a) exchanges between Cryptocurrencies and Fiat currencies;

b). exchanges between virtual assets;

c). the transfer of Virtual assets;

d). the safe-keeping of Virtual assets;

e). the provision of financial services related to an issuer’s offer or sale of a virtual asset.

This category has now been modified into an Ancillary VASP (AVASP) license, which as a license covers providers of digital asset non-custodial services such as crypto wallet services .This license category comes with a share capital requirement of 300 (Three Hundred) Million Naira.

e). Digital Asset Platform Operator (DAPO) Licenses :- This applies to businesses that own platforms for the offering & issuance of newly minted digital assets & also include token issuers themselves. This license category carries a minimum share capital requirement of 500 (Five Hundred) Million Naira.

f). Digital Asset Intermediary (DAI) Licenses:- This license applies to digital asset brokers, portfolio managers & digital investment advisors and carries a minimum share capital requirement of 500 (Five Hundred Million) Naira.

g). Real-World Assets Tokenization & Offering Platforms (RATOP) Licenses :- This license category applies to businesses involved in the tokenization of “real world” or physical assets like real estate & carries a minimum share capital requirement of 1 (One) Billion Naira.

What is the licensing process for procuring any of the licenses mentioned above?

SEC licensing for digital asset/crypto service providers in Nigeria typically involves going through 2 processes known as :-

a). The SEC Regulatory Incubator (RI) Sandbox :- For new crypto start-up businesses offering innovative blockchain-based services that require controlled testing & observation by the SEC. Admission into this sandbox typically lasts a year.

b). The Accelerated Regulatory Incubator Program (ARIP):– For crypto service businesses already in operation before the SEC 2022 rules & are just seeking formal registration with the SEC. Admission into this sandbox typically lasts up to 12(Twelve) months.

What are the eligibility & other requirements for admission into the RI and ARIP programs?

Admission into the RI and ARIP incubation programs are open to :-

a). Nigerian companies or companies licensed by an overseas securities operator (MISA registration in Europe for example). This means foreigners or foreign businesses seeking SEC licensing will have to register foreign-owned Nigerian companies with the Corporate Affairs Commission (CAC) and procure Certificates of Capital Importation (CCI). The CEO or managing director of an applicant company must be resident in Nigeria.

b). Businesses offering innovative products, solutions, technologies or services to the Nigerian capital market (the SEC regards digital assets & tokens as securities or digital interpretations of real life value or money demand similar to shares as debt instruments).

Admission requirements into the RI and ARIP include:-

a). Submitting an admission assessment form to SEC with an assessment fee of 50,000.00 Naira for the RI & 200,000.00 Naira for the ARIP.

b). Evidence of shareholders funds.

c). A 25% fidelity bond .

d). 4 (Four) sponsored individuals representing the company.

e). A processing fee of 2 million Naira (for ARIP admission only,not the RI).

f). Proof of registration with the Nigerian Financial Intelligence Unit (NFIU).

g). A letter of “no objection” from other sectoral regulators if applicable.

h). Company incorporation documents.

i). An end-to-end schematic illustration of the applicant company’s proposed business operations or product operation(especially for RI admission).

Note that with admission into the RI, the SEC has the power to issue a discretionary waiver of the rules for applicants with products that might be deemed particularly innovative.

Does this mean P2P (Peer-to-Peer) crypto trading is now illegal in Nigeria?

No,P2P trading for now hasn’t been rendered illegal by the SEC Rules yet. But facilitating P2P trading for a fee would be deemed by the SEC as running an unlicensed crypto business and can attract serious penalties.

What if I decide to run an unlicensed crypto/digital & virtual asset business under the radar without the knowledge of the SEC?

If caught, this can attract a fine of at least 10-20 Million Naira, minus the possibility of imprisonment of 5-10 years & asset forfeiture.

I’m a start-up techpreneur involved in crypto business services, but I simply can’t afford the share capital requirements required by the SEC in order to gain admission into the RI or ARIP. I’m even currently bootstrapping. What can i do as an alternative licensing measure to avoid getting into trouble with the SEC?

Start-up techpreneurs have the following alternative licensing options, but they’ll first need to consult a lawyer to determine the viability of these options, most of which are still under regulatory control:-

1). Strategic partnership with SEC-licensed crypto businesses via umbrella agreements.

2). Seeking alternative SEC licensing as digital, corporate, or individual sub-brokers or crowdfunding intermediaries (with a minimum share capital requirement of 10-200 million Naira) and then entering digital asset service partnership agreements with SEC-licensed crypto businesses.

3). Seeking more affordable Central Bank of Nigeria (CBN) licensing as payment gateways for crypto service companies focused on the facilitation of fiat payments (this carries a minimum share capital of at least 100 million Naira as prescribed by the CBN). Umbrella agreements are also possible with CBN licensing.

Emmanuel Ifeanyi Ogbuka, Esq, a lawyer and legal consultant, writes from Lagos,Nigeria.

Phone:- +2347011261897

Email:- ogbukalegal@outlook.com

***PLEASE NOTE****:- This article is strictly for informative purposes and neither constitutes legal advice nor prohibited advertising as prescribed by the Rules Of Professional Conduct For Legal Practitioners In Nigeria.

HOW TO SECURE DIGITAL MONEYLENDING BUSINESS REGISTRATION /FCCPC DIGITAL LENDING LICENSING IN NIGERIA – ALL YOU NEED TO KNOW| Emmanuel Ifeanyi Ogbuka

by Legalnaija | Mar 25, 2026 | Blawg

Introduction:- Digital consumer lending has come a long way in Nigeria, starting from the introduction of Microfinance Banks (MFBs) and lending companies that evolved from one-man money-lenders that in some cases acted as glorified loan sharks, to money lending licenses governed by state governments, to loan apps operated by Nigerian & foreign-owned companies that sometimes engaged in business practices that by today’s standards, were quite very unfair and downright illegal.

Digital consumer lending is simply the business of licensed money-lenders rendering consumer lending services through the means of digital loan web or mobile applications, which means that in order to own a digital lending platform (be it a website, USSD service, or app) operational in Nigeria, 2-tier licensing must be obtained, first from the relevant state government in the state where the intending money-lender is located, and then from the Federal Competition & Consumer Protection Commission (FCCPC), the government agency tasked with granting licensing to digital lenders in Nigeria.

This article will be looking at:-

1). Eligibility requirements for licensing as digital lenders in Nigeria.

2). The cost & time implications of securing digital money-lending licensing in Nigeria.

3). The validity of digital lender licensing grants in Nigeria.

4). The relevant FCCPC regulatory requirements where lending partnerships are formed for the purpose of rendering consumer lending services in Nigeria.

What is the major regulatory provision governing FCCPC licensing of digital lenders in Nigeria?

The FCCPC exercises its jurisdiction over the licensing and regulation of digital lenders in Nigeria through its DEON (Digital, Electronic, Online/Non-Traditional) Consumer Lending Regulations.

Which companies are eligible to secure digital lending licensing from the FCCPC?

FCCPC licensing is open to companies that have already obtained money-lending licenses from their respective state governments as other non-lending financial service companies (like Mobile Money Operators or MMOs)licensed by other sector regulators like the Central Bank of Nigeria (CBN).

What is the minimum share capital requirement for a money-lending company?

Money-lending companies in Nigeria carry a minimum share capital requirement of 20 (Twenty) Million Naira & 100 (One Hundred) Million Naira for foreign-owned companies .

What are the requirements for obtaining a money-lending license from states like Lagos State for instance?

Getting a money-lending license in Lagos State requires the following:-

a). A registered limited liability company with at least 2(Two) directors and relevant incorporation documents.

b). Proof of a physical office in Lagos State.

c). Police clearance for the 2 directors.

d). 3- year Tax Clearance Certificates (TCCs) or proof of tax registration of the company if it’s newly registered & its 2 directors.

e). A reference letter from the applicant company’s bank.

f). Filled & submitted magistrate forms B & C.

g). An application fee of 25,000.00 Naira.

h). A registration/license fee of 200,000.00 Naira.

i). A license renewal fee of 100,000.00 Naira.

How long does it take to get the state money-lending license?

If all documentation is complete, at least 4-8 weeks.

How long does FCCPC digital lending licensing take?

It takes a period of 30(Thirty) days from the submission of all required documentation.

What are the requirements for FCCPC digital lending licensing?

a). Filled & submitted application forms 001 & 002.

b). An application fee of 100 (One Hundred) Thousand Naira.

c). An approval/licensing fee of 1(One) Million Naira. This enables a digital lending company to have 2 separate digital loan apps.

d). An additional approval fee of 500 (Five Hundred) Thousand Naira for an extra third lending app proposed by a licensed money-lending company. A licensed digital lender is allowed to have a maximum of 5 (Five) loan apps.

e). A consumer lending services agreement where the licensed money-lending company is in a partnership with a technology services company to provide the tech infrastructure needed to provide the consumer lending services.

f). A completed data regulations compliance audit report from a Data Protection Compliance Organization (DPCO) as well as Nigerian Data Protection Commission (NDPC) clearance. These will arrest that a digital lending company will not engage in DEON violations that include accessing the call log & & reaching contacts of loan defaulters.

g). The company’s compliance policies – Anti-Money Laundering(AML/CFT) , Privacy policy, KYC Policy, & Dispute Resolution policy among others.

What is the validity period of FCCPC licensing for digital lenders in Nigeria?

FCCPC licensing for digital lenders lasts till the 31st of December of the third year from the date of FCCPC licensing approval and is required to be renewed not later than the 31st of March of the subsequent year.

FCCPC licensing renewal requires a renewal fee of 500(Five Hundred)Thousand Naira. 

Can FCCPC licensing be revoked and on what grounds?

Yes, FCCPC licensing for digital lenders can be revoked on the grounds of:-

a). Violating the DEON regulations or any relevant regulation of the FCCPC.

b). Discovery of misleading or false information supplied to the FCCPC by a money-lending company at the licensing stage.

c). A money-lender acting against the interests of its consumers/platform end-users.

Revocation of licensing can also come with imposition of fines on a defaulting money-lending company.

Emmanuel Ifeanyi Ogbuka, Esq, a lawyer and legal consultant, writes from Lagos,Nigeria.

Phone:- +2347011261897

Email:- ogbukalegal@outlook.com

***PLEASE NOTE****:- This article is strictly for informative purposes and neither constitutes legal advice nor prohibited advertising as prescribed by the Rules Of Professional Conduct For Legal Practitioners In Nigeria.