The Central Bank of Nigeria (CBN) has officially commenced an Anti-Money Laundering, Counter-Financing of Terrorism, and Counter-Proliferation Financing (AML/CFT/CPF) supervision pilot in a significant move to bolster the integrity of Nigeria’s financial ecosystem.
The initiative targets a select group of Virtual Asset Service Providers (VASPs), signaling a more rigorous approach to oversight in the digital asset space.
According to a statement, the apex bank identified six major players to participate in this initial supervisory phase. The list includes fintech giants and crypto-focused platforms like Flutterwave, Paystack, cNGN, Juicyway, Koinkoin and KuCoin.
The apex bank clarified that these entities constitute the first set of a multi-phase programme. Notably, future phases are already fully scheduled, and the CBN is not currently accepting external expressions of interest.
The pilot is a risk-based supervisory program rather than a new licensing regime. According to the CBN, the primary goal of risk mapping is to develop a structured understanding of business models and operational risks within the VASP sector. The global compliance objective aims to support entities in aligning with international standards, specifically FATF Recommendations 15 and 16, with a heavy focus on Travel Rule preparedness. Additionally, the program seeks to strengthen the oversight of virtual asset activities to ensure they do not undermine Nigeria’s financial stability.
During this period, participating firms are under a microscope. They are required to submit monthly Key Performance Indicators (KPIs) and undergo comprehensive reviews. These reviews will scrutinize governance structures, customer onboarding (KYC) processes, sanctions screening and transaction monitoring and implementation plans for the FATF travel rule.
The CBN emphasized that participation in this pilot is strictly supervisory. It does not confer any formal regulatory status, licensing rights, or official authorization upon the participating companies.
The pilot is anchored in the Money Laundering (Prevention and Prohibition) Act 2022 and the BOFIA 2020. The CBN assured participants that all data submitted will be treated as confidential, in strict adherence to the Nigeria Data Protection Act 2023.
This move marks a pivot toward a controlled and structured engagement between the regulator and the burgeoning crypto industry, aiming to clean up market practices without immediately altering the existing legal framework for virtual assets.