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SWVL’s Latest Scorecard: A Bounce in Earnings Overshadowed by Revenue Challenges

December 27, 2023

Mostafa Kandil, Swvl’s co-founder and CEO

In the ever-evolving landscape of tech-driven mobility solutions, Swvl Holdings Corp has recently presented a financial scorecard that showcases a noteworthy rebound in earnings, but not without casting shadows over its revenue performance. The Nasdaq-listed company, a prominent player in enterprise and government mobility solutions globally, is making headlines for its resilience amid economic headwinds, yet questions linger about the sustainability of its financial turnaround.

Earnings vs. Revenue: A Delicate Balance

The latest financial report for the first half of 2023 unveils a stark contrast between Swvl’s earnings and revenue. While the company boasts positive figures in operating cash flow and net profits, the revenue picture paints a less rosy scenario. The figures present a financial narrative where earnings are the shining star, but revenue remains a stumbling block.

Earnings in the Spotlight:

One cannot ignore the commendable achievements in Swvl’s earnings. Operating cash inflows of $2.2 million in H1 2023, compared to the staggering outflows of $76.8 million in H1 2022, highlight a strategic pivot that merits applause. The gross profit of $1.8 million in H1 2023, in contrast to the gross loss of $2.7 million in H1 2022, signals a significant boost in operational efficiency. The operating profit’s impressive shift from a loss of $56.0 million to a profit of $13.4 million showcases the effectiveness of the portfolio optimization program initiated last year.

Most striking is the reversal in net profit, transforming from a daunting net loss of $161.6 million in H1 2022 to a positive net profit of $2.1 million in 2023. CEO Mostafa Kandil attributes this success to the team’s adept handling of a macroeconomic downturn, crediting the completion of the portfolio optimization strategy.

Revenue Woes:

However, the celebration of earnings is tempered by the less-than-stellar revenue figures. Swvl reports a decrease in revenue from $21,671,391 to $11,116,013, signaling challenges in generating top-line growth. The drop raises critical questions about the company’s market positioning, the impact of its strategic decisions, and the adaptability of its business model.

The sale of subsidiary Urbvan, representing approximately 7% of Swvl’s IFRS revenues, for gross proceeds of $12 million, adds another layer to the revenue puzzle. The move prompts industry observers and investors to ponder the implications for future revenue streams and the overall strategic direction of SWVL.

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Algeria Commences Tax Convention With Japan

Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.

T-Vencubator Unveils Game-Changing Fund and Incubator for Egyptian Tech Startups

In a groundbreaking move to bolster innovation and entrepreneurship in Egypt, the T-Vencubator Fund has been officially unveiled. Pioneering a fusion of venture capital funds and business incubators, this initiative is exclusively dedicated to supporting companies offering technological solutions to address the real challenges facing Egyptian society.

The T-Vencubator Fund represents a golden opportunity for local startups leveraging technology to confront the multifaceted challenges prevalent in Egyptian society. It introduces a novel approach by supporting entrepreneurs with both venture capital and comprehensive incubation support essential for their growth. The term “Vencubator,” a blend of Venture Capital and Incubator, encapsulates this innovative concept.

Reem Safi, the Founder and CEO of T-Vencubator Fund, emphasized the timely nature of the fund’s launch. In a global context where startups play a pivotal role in developing economies, Safi sees investing in these companies as a national duty, given Egypt’s track record of startup success in recent years.

Safi stated, “We believe that technology can address many of the issues facing Egyptian society. Egyptian minds harbor innovative ideas capable of tackling these problems. We are not just injecting financial investments into startups; we are investing in exceptional talent that will shape Egypt’s future.”

Detailing the investment plan, Safi outlined the focus on promising companies with robust ideas providing technological and AI-driven solutions to societal challenges. Specific companies and investment amounts will be disclosed throughout 2024.

Hazem El Samra, Head of Growth and Marketing at T-Vencubator Fund, expressed pride in launching the first investment fund and business incubator with a distinctly Egyptian character. Emphasizing key selection criteria, he noted, “We focus on innovative ideas grounded in the latest technological solutions capable of addressing the real challenges in our community.”

El Samra continued, “Inspiring ideas based on technology deserve to be highlighted. While financial investment is crucial, practical support rooted in knowledge and experience is equally vital, forming the core philosophy of the T-Vencubator Fund.”

Egypt currently leads the Middle East in startup funding volume, underscoring the country’s market size and the significance of an Egyptian success partner. Such a partner, as T-Vencubator aims to be, provides crucial elements for the success of Egyptian companies, including financial support, mentorship, a local vision, technological infrastructure, and necessary human resources for innovation and success.

Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.

Algeria Commences Tax Convention With Japan

Japan has received from Algeria the notification confirming that its internal procedures necessary for the entry into force of the “Convention between Japan and the People’s Democratic Republic of Algeria for the Elimination of Double Taxation with respect to Taxes on Income and the Prevention of Tax Evasion and Avoidance” (hereinafter referred to as the Convention) (signed on February 7, 2023) were completed. Thus, all the necessary procedures for the entry into force of the Convention have been completed.

The Convention, therefore, will enter into force on January 20, 2024 (the thirtieth day after the date of receipt of the latter notification) and will have effect:
(a) with respect to taxes levied on the basis of a taxable year, for taxes for any taxable years beginning on or after January 1, 2025;
(b) with respect to taxes levied not on the basis of a taxable year, for taxes levied on or after January 1, 2025.

The provisions concerning the exchange of information and the assistance in the collection of taxes will have effect from January 20, 2024, without regard to the date on which the taxes are levied or the taxable year to which the taxes relate.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Top 5 Predictions in the Enterprise IT Space for 2024

Technological development is often the result of aspiring to augment the experiences of its consumers. Over the past few years, this notion has only been reaffirmed, with tech powering users through lockdowns, recessions, and other crises. 2023 has been a transformational year, with both existing technologies and novel innovations revolutionising the way organisations work. In 2024, enterprises will continue to embrace further updates to technological measures that design a better digital environment for everyone.

“Although the need to implement a digital-first experience has been constant, the ways by which it can be realised varies periodically. In 2024, we believe that your organisation would benefit from a unified approach of deploying new tech and focusing on demanding aspects of business — such as privacy, LLMs, and orchestration,” said Rajesh Ganesan, President at ManageEngine.

Here are ManageEngine’s top five predictions for trends in 2024 that will help organisations root themselves in the bedrock of this new age of work.

1. Privacy and AI governance will become a top business priority

Although 2023 has witnessed numerous regulations across geographies — including the EU’s AI Act, the UAE’s Data Protection Act, India’s Digital Personal Data Protection (DPDP) Act, — these are indicators that a further inflow of similar policies is imminent. With AI being integrated into every aspect of business, disruptive technologies (such as deepfakes and augmented reality) threaten privacy and pose significant risks. These technologies should be placed under a keen watch for both public and private use. As an effort to ensure ethical, transparent, and fair use of the technology, AI governance will become paramount importance to businesses. We also believe that privacy will be the core of every business going forward, and protecting it will become the responsibility of every individual in the organization.

2. Enterprises will be keen to adapt to purpose-built LLMs rather than general-purpose LLMs

Ever since the advent of AI, businesses have leveraged its capabilities to fulfil predictive analysis and automate low-skill tasks. However, the narrow applications of AI and its immense engineering difficulties call for AI training models that can cater to all aspects of a business. Enterprise-focused large language models (LLMs) help both employees and customers alike achieve deep-nested conversations with the enterprise’s offerings and align better with evolving software tools. By adapting such models, enterprises will be better able to deploy their vast amount of knowledge to address both their creative and redundant workloads. It will also empower organizations to protect their data, reduce biases in their data, and provide detailed audit reports to understand AI decisions.

3. The power of orchestration will span the entire enterprise

In recent times, many businesses have turned to digital transformation to carry out their core functions online. This transition has presented the challenge of fragmentation — splitting data into organisational silos and hampering the flow of information. Enterprises are likely to overcome the issue of fragmentation by harnessing the power of orchestration, which allows for the construction of interconnected digital pipelines that lead to workflow automation and streamlined operations. By adopting this user-friendly and accessible technology, organisations will be prepared to make complex tasks achievable and survive in the digital realm.

4. The digital-first experience will evolve to the secure digital-first experience

Having moved on from traditional work methodologies, we will observe organisations integrate contemporary IT management tools to provide a holistic and safe digital journey. In 2024, we believe enterprises will also adopt an identity-centric approach, ensuring that only authorized individuals are granted access and permissions, therefore safeguarding their identities and data. Going a step further, cloud infrastructure and entitlement management (CIEM) will be implemented to increase granular visibility and minimize threats by providing a comprehensive view of identities and entitlements across diverse cloud environments. Together, such solutions will bolster security and enable a worry-free digital experience for the end users.

5. Cyber resilience will become a strong business differentiator

Today’s technological landscape presents a series of challenges for modern companies that stunt progress. These challenges include the geopolitical climate, technological disruption, cyberthreats, competitive pressure, and many other factors, all of which could be more easily faced when strategic plans are in place. In 2024, we will see companies actively invest in such plans that bring about the tools, solutions, and culture necessary to enhance their overall cyber-resiliency posture. Consequentially, cyber resilience will emerge as a key business differentiator, enabling organizations to succeed in the complex global market.

ManageEngine envisions that these IT forecasts will help organizations seamlessly pace themselves with an imminent transformation in work culture. By staying attuned to emerging trends and technologies, organisations will be enabled to capitalise on opportunities and remain competitive in this ever-evolving digital ecosystem.

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Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.

FBS Partners Education Africa for Poverty Alleviation

December 26, 2023

FBS, a global broker, and Education Africa, a non-profit organization committed to poverty alleviation through education, united again to distribute Christmas gifts and extend their warm wishes to families in need from Etwatwa, Daveyton. As part of their ongoing collaboration, FBS and Education Africa are eager to make a positive impact in local communities in South Africa.

On December 18, to kick-off the joint Christmas initiative, representatives of FBS and Education Africa visited the John Wesley Community Centre in Etwatwa, one of the many communities served by Education Africa, the community center plays a vital role in providing aftercare and youth development services in the region.

Before the organizations set off to present the festive gifts, the Education Africa Alumni Marimba Band, gave a cheerful performance to enhance the festive spirit.

Early Christmas Present

The joint initiative was an early Christmas present to the community of Etwatwa – over 100 children, youth, and adults received food parcels and basic necessities from FBS and Education Africa. With these gifts, the two partners for change hoped to make the festive season better for the locals of Etwatwa.

In continuation of their commitment to education, it is to be pointed out that earlier this year, both organizations collaborated to support Masibambane College in Orange Farm. This exemplifies FBS and Education Africa’s dedication to making a lasting difference in the lives of those they serve.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

UNICEF Donates Computers, Projectors to Sierra Leone for Young People

December 25, 2023

UNICEF Sierra Leone handed over 113 laptops and 23 projectors to the Ministry of Communications, Technology, and Innovation for young people in 39 schools across the country as part of the Giga project.

Giga is a UNICEF-International Telecommunications Union (ITU) initiative to connect every school to the Internet and every young person to information, opportunity, and choice.

“This strategic move is expected to empower students to emerge as leaders and driving forces of development across the nation in line with national priorities that reflect a collective commitment to advancing education, technology, and youth empowerment,” said Ms Salima Bah, Minister of Communications, Technology and Innovation as she received the items. “These will foster innovation, facilitate employment opportunities, and constructing a robust digital economy for youths in the country.”

Currently, less than 1 per cent of schools in Sierra Leone are connected to the Internet and only three out of ten people have access to the Internet.

“We need to bridge the digital divide by increasing access to technology and empowering young people with the skills they need to navigate and benefit from opportunities in this digital era,” said Rudolf Schwenk, UNICEF Representative in Sierra Leone. “With limited access to technology and the internet, thousands of children and young people lack the digital skills they need for their future.”

A 2021 global report by the Economist Intelligence Unit found that a 10% increase in school connectivity can increase effective years of schooling by 0.6 per cent and increase GDP per capita by 1.1 per cent.

The initiative will contribute to the transformative potential of empowering young people with technology to bridge the digital divide by setting up tech-enabled learning hubs, connecting schools to the internet, and supplying essential equipment so that young people could be equipped with modern digital skills.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

African Energy Chamber (AEC) Applauds Congo and Nigeria’s Commitment to Global Oil Industry Growth and Stability Through OPEC Cooperation

NJ Ayuk, Executive Chairman of the African Energy Chamber, CEO of pan-African corporate law conglomerate Centurion Law Group

The Republic of Congo and Nigeria, Africa’s leading oil producers and members of the Organization of the Petroleum Exporting Countries (OPEC), have affirmed their commitment to efforts by OPEC and OPEC+ and its member countries to stabilize the global oil market in 2024 and beyond.

During the 36th OPEC and non-OPEC Ministerial Meeting held in November, the organization and its member countries, reached an agreement with participating countries over the production quota for 2024. As part of the agreement, the Republic of Congo will target a production quota of 277 billion barrels of crude oil per day (bpd). Simultaneously, Nigeria has agreed to a production quota of 1,500 bpd as from January 2024. The aim is to ensure a stable and balanced oil market at the helm of various factors, including the energy transition and changes in energy consumption patterns, impacting the global oil market and oil-producing countries.

“The Republic of Congo reaffirms its steadfast commitment to the strategic policy defined by the Secretary-General of OPEC and OPEC+. We strongly support the efforts to stabilize and promote sustainable development of the oil markets, a crucial approach for the future of our sector and the global economy. Furthermore, the Republic of Congo highlights the remarkable harmony prevailing among the members of the OPEC and OPEC+ Ministerial Conference,” stated Bruno Itoua, Minister of Hydrocarbons for the Republic of Congo, adding that “This harmony reflects our common commitment and shared willingness to work together for mutually beneficial goals. The Republic of Congo is committed to continuing close and constructive collaboration with all member countries. We are determined to foster initiatives that serve the collective interest of the oil industry, while positively contributing to overall economic well-being.”

Sen. Heineken Lokpobiri, Minister of State for Petroleum, Nigeria reaffirmed Nigeria’s unwavering commitment to OPEC in addressing the changing dynamics of the global energy sector. He said “Our collaboration within the organization remains pivotal in fostering stability and sustainability in the oil market. We are resolute in our dedication to OPEC’s objectives while actively engaging with the organization to address concerns that resonate not only within our nation’s borders but across the entire continent. Nigeria stands ready to contribute constructively to the ongoing dialogue, ensuring that the unique challenges and opportunities of our region are duly recognized and addressed.”

The African Energy Chamber (AEC), as the voice of the African energy sector, strongly supports the Republic of Congo and Nigeria, for their commitment to foster the growth and stability of both the African and global oil markets through collaborative efforts on market sustainability and expansion with OPEC, OPEC+ and member countries.

For decades, OPEC has positioned itself as a reliable consortium for global oil producing countries such as the Republic of Congo and Nigeria to strengthen upstream operations, local content development and resource monetization strategies while navigating the shifting global market. At the same time, the Republic of Congo and Nigeria with the support of OPEC, OPEC+ and member countries have placed themselves as key contributors to global energy security. With substantial proven reserves of approximately 1,811 million barrels and through cooperation with global players such as TotalEnergies, bp, Eni Perenco, Chevron and Kosmos Energy, Congo represents one of the world’s most important oil producers. On the hand, Nigeria has for decades ranked as Africa’s top producer and one of the world’s most important oil exporters.

The Chamber believes that with the energy transition taking center stage and global climate policies disrupting the oil industry, at a time African countries maximize oil production and monetization to address growing energy poverty and demand at global scale while accelerating industrialization, OPEC has a huge role to play. Through enhanced cooperation with OPEC and OPEC+ member countries, the Chamber is confident that Congo will accelerate oil production and continue to shape the growth of the African industry and resilience of the global market.

“The Republic of Congo and Nigeria, through cooperation with OPEC, OPEC+ and global member countries, have succeeded in ensuring the sustainable growth of the African oil sector. Their commitment to adhere to principles laid by OPEC to ensure the continued growth of the sector, is a huge testimony of the organization’s obligation and ability to contribute to the growth of African economies on the back of optimal exploitation of oil resources. We welcome and support Nigeria and Congo’s commitment to OPEC and future expansion and stability of the oil sector,” stated NJ Ayuk, the Executive Chairman of the AEC.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Small African Agribusinesses Use Tech to up Their Game

December 23, 2023

Agritech solutions and digital marketing can help empower agricultural startups. As literacy increases in rural areas and infrastructure improves, young farmers and agri-processors working with the International Trade Centre (ITC) can integrate new tech solutions into their operations.

ITC’s Alliances for Action, under the Netherlands Trust Fund V (NTF V) programme, has partnered with Bopinc, which works on tech solutions for businesses, to close the gap between small agribusinesses and the tech sector. They’re working with small and medium-sized processors of cocoa in Ghana, coffee in Ethiopia, and cashews and other crops in Senegal.

The goal is to upscale their operations to generate better profits, improve incomes, and create more jobs by processing local crops in-country.

Activities focus on market research, product development, sustainable processing, packaging, marketing, and developing targeted commercial linkages. To ensure a holistic approach, tech tools and platforms are integrated into business operations.

This also prepares small businesses for the new EU Corporate Sustainable Due Diligence Directive (CS3D) through more precise data collection, greater transparency, and improved traceability.

Ready, game, set and match: Agritech pilots are underway

Grounded in a tested methodology and a participatory approach, Bopinc assessed the digital needs of selected businesses in Ghana, Ethiopia and Senegal to match them to service providers.

They found that the businesses need to digitalize their processes through enterprise resource planning (ERP) systems. That allows for more transparency and traceability of operations to comply with rules like the EU CS3D directive.

In Senegal, cashew nut processor Zena was matched with tech solutions tailored to improve the competitiveness and market access of their ‘made in a Senegal’ operations. These target local consumers who want local products – a nascent trend that is rapidly growing in Dakar.

In Ghana, the pilot involves a Fair Trade-certified farmer cooperative, the Kuapa Kokoo Cooperative Cocoa Farmers and Marketing Union Limited (KKFU). This collaboration promises to usher in a new era of digitalization and technological advancements, offering exciting possibilities for KKFU’s 100,000 cocoa farmers.

In Ethiopia, the pilot is currently underway, with a focus on setting up an automated system to track the coffee production and increase efficiency of the Bench Maji Coffee Farmers’ Cooperative Union, which has 21,000 farmer members.

A second pilot in Ethiopia will match the Oromia Coffee Farmers’ Cooperative Union with tech company AgUnity to develop co-op manager systems that also targets compliance with EU legislations.

The GPS coordinates of 3,000 farmers from four primary cooperatives have been registered. GPS is a key tool to comply with the EU’s regulation on deforestation-free products.

The businesses will also have access to a directory of digital tools created in Ethiopia – a groundbreaking initiative that ITC aims to replicate across other countries.

The pilots are conceived to be sustainable beyond the life of the project as they benefit from co-funding from the beneficiaries. The pilots are part of capacity building to business service organizations to ensure transfer of know-how and tools at the national level in support of digital transformation of the agribusiness sector.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Cashew Brands Upgrade Their Packaging in Senegal

ITC is supporting small cashew processors and brands in Senegal to reach new markets and grow their operations. They organized a training on packaging for 30 cashew processing businesses in Senegal.

West Africa exports more cashews than any other region in the world. Senegal is part of that boom, along with Cote d’Ivoire, Ghana, Burkina Faso and Nigeria.

Established and new brands in Senegal want to turn raw cashews into higher-value products, creating innovative products for export and the local market. Cashew jams, juices, bars, and flour are just some of the products appearing on the shelves.

Looking at this context ITCs Alliance for Action sustainable agribusiness initiative organized a training course on product packaging for 30 participants from 11 small businesses working with cashews. In Senegal, under the Netherlands Trust Fund programme ITC is working with cashew businesses to grow their operations sustainably, improve their competitiveness and reach new markets. Improved packaging will be one step in the right direction.

The training was facilitated by Frederic Couty, a packaging and continuous improvement consultant at ITC. He guided the businesses on how best to develop packaging with efficient systems that improve profits and sustainability.

A step-by-step methodology goes through the process of choosing packaging materials, graphic design, labelling, equipment, packaging for transportation, and more.

In line with consumer trends that favor environmentally friendly businesses, a special focus was placed on sustainable packaging. This will allow the brands to tap into European Union and other international markets as well as better accessing their existing local and regional markets.

He also delivered tailored coaching to eight companies from the NTFV cohort with factories in and around Dakar and in Casamance, Senegal’s biggest cashew-producing region.

Cashew apple juice company Casadeliz, is working on a new packaging and marketing strategy that is more adapted to the UK market with the use of cans and tetra packs.

‘To promote the “made in Senegal” model, we need quality packaging because at the international level, the competition is not only on product quality but also on packaging,’ said Fatou Mbod, manager of the Casamance Verte GIE.

Mireille Dovonou, sales and marketing assistant at Lysa & Co, was most interested in the tailored approach of packaging. ‘We understood that packaging must be aligned with the company’s vision and mission. Packaging must also be adapted to the customer’s needs, which can be identified through surveys and test trials before validating and commissioning the final packaging.’

Moving on, ITC-Alliances for Action will be supporting the businesses as they implement the new methodology. The ITC teams will replicate this strategy for cocoa in Ghana and coffee in Ethiopia.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Central Bank of Nigeria Lifts Ban on Crypto Transactions Through Banks

December 22, 2023

In a significant policy shift, the Central Bank of Nigeria (CBN) has announced the lifting of the ban on cryptocurrency transactions carried out through banks. The decision was communicated through a circular titled “GUIDELINES ON OPERATIONS OF BANK ACCOUNTS FOR VIRTUAL ASSETS SERVICE PROVIDERS (VASPs),” issued to all banks and financial institutions.

The CBN had initially imposed a ban in February 2021, citing concerns about money laundering, terrorism financing, and the lack of regulatory frameworks for virtual assets. However, recognizing the global trend towards regulating virtual asset service providers (VASPs), including cryptocurrencies, the CBN has revisited its stance.

The circular outlines that the Financial Action Task Force (FATF) emphasized the need for VASPs regulation to prevent the misuse of virtual assets for illicit activities. Moreover, recent legislative developments, such as Section 30 of the Money Laundering (Prevention and Prohibition) Act, 2022, and rules issued by the Securities and Exchange Commission (SEC) in May 2022, have acknowledged and provided a regulatory framework for VASPs in Nigeria.

The new guidelines supersede previous circulars from 2017 and 2021, but it reiterates that banks and financial institutions remain prohibited from holding, trading, or transacting in virtual currencies on their own account. Financial institutions are now mandated to comply immediately with the provisions of the new guidelines.

Crypto bank Nigeria — *Yemi Cardoso is Nigeria’s new Central Bank Governor.*

This announcement marks a departure from the CBN’s earlier stance when, in 2021, it issued directives instructing all commercial banks and financial institutions to close down bank accounts associated with cryptocurrencies. The ban was a response to perceived risks and vulnerabilities associated with cryptocurrency transactions, as expressed in a letter signed by Bello Hassan, Director of Banking Supervision, and Musa I. Jimoh, Director of Payment Systems Management Department.

In a related development in 2020, Nigeria’s Securities and Exchange Commission (SEC) declared that all virtual crypto assets issued in Nigeria are securities, unless proven otherwise. The SEC mandated the registration of individuals or entities providing blockchain-related and virtual digital asset services, broadening the scope to include advising on cryptocurrencies and rendering custodian or nominee services.

The regulations also specified a three-month window for Digital Assets Token Offerings (DATOs), Initial Coin Offerings (ICOs), and Security Token ICOs to submit necessary documents for registration. Additionally, the SEC outlined the process of registration and possible exemptions for offerings through crowdfunding portals or other exempt methods.

Crypto bank Nigeria Crypto bank Nigeria

What Does The New Crypto Regulation In Nigeria Mean For Crypto Traders?

Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.