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INFORMATION ABOUT REGULATION
Key features of regulation include:
- Capital requirements & liquidity — Our business is required to maintain minimum levels of capital. There is an initial and continuous threshold of NGN 10 Million own funds. We must also hold sufficiently liquid assets to be able to redeem all e-money issued and to meet our working capital requirements.
- Float Management — There is a clear set of regulations on how we can invest the funds received in exchange for the issue of e-money; this is essentially limited to pre-defined low-risk and highly liquid forms of investment such as government bonds with short maturity and savings accounts in the bank.
- Management & Vetting at Entry — Our management is scrutinised and all individuals who perform key functions within our business are approved to be "fit and proper". Significant responsibilities such as finance and technical development and money laundering reporting are apportioned between senior staff.
- Systems & Controls— We must protect our businesses from technological risks such as unauthorised creation, transfer or redemption of e-money. Care must be taken to implement systems and policies to ensure compliance with the codes of practice. Here at
OnlineNaira, any e-money issuer must comply with good principles for business which include observing proper standards of market conduct, arranging adequate customer complaint procedures and having in place adequate risk management systems.
- Know Your Customer (KYC) -
KYC is the due diligence we must perform to identify our clients and ascertain relevant information before doing financial business with them. Our KYC policies and procedures emphasize the following:
- Obtaining necessary documents and information from every customer.
- Prohibition of opening anonymous accounts.
- Conducting ongoing due diligence on the business relationship and scrutiny of transactions undertaken throughout the course of that relationship to ensure that the transactions being conducted are consistent with our knowledge of the customer and their business, including, where necessary, the source of funds.
- Customer information update whenever the need arises
- Obligation to report to the regulatory authorities suspicious transactions, which may ultimately have a bearing with money laundering activities
- Money Laundering — OnlineNaira is part of a wider international effort to meet the challenges of restricting criminal access to the financial system, and participates in international talks to make sure the rules remain effective.
The Money Laundering Regulations require firms to put preventative measures in place. They require firms to ensure that they know their customers (including conducting customer identification and verification and undertake ongoing monitoring where applicable), to keep records of identity and to train their staff on the requirements of the Regulations. A senior member of staff needs to be appointed and approved to oversee appropriate policies and procedures.
- Forex Trading — OnlineNaira is required to be a responsible money processor even when sending money to a Forex company that is not located in the country of the trader. In order to help protect member payments to foreign forex agents, OnlineNaira withholds up to 20% of all monies deposited for the purposes of Forex Trading. This money is paid out to the forex company after 12 months of responsible trading.
- Limitation on Business Activity— e-money issuing must be legally and operationally ‘ring-fenced’ from any other area of business risk, e.g. granting credit is disallowed.