Money forms an integral part of existence for humanity. It is needed for the survival of day-to-day activities of mankind; and to meet the survival needs of man. To cushion the strict collateral requirement and high interest rate of financial institutions, individuals and companies other than financial institutions, have ventured into the business of money lending at a reduced interest rate.

Generally, anyone who lends money with interest is presumed to be a money lender until the contrary is proven[1] and to be able to effectively recover the principal sum and interest, such an individual or company must be a licensed money lender.


The Lagos State Money Lenders Law specifically enumerates the requirements for obtaining a moneylenders license in Lagos State which are:

  1. Certified True Copies (CTC) of CAC Form 2 and 7, for a company registered in 2017 upward what is needed is a CTC of form 1.1
  2.  Certified True Copies of the Memorandum and Articles of Association of the Company. (The memorandum must contain an object to the effect that the Company engages in the business of providing lending services to companies, individuals, etc.)
  3. Certified True Copy of the Certificate of Incorporation of the Company.
  4. Tax clearance of the individual applicant. If a corporate body, 3years Tax clearance of at least 2 Individual directors of the Company.
  5. Evidence of Maintenance of current account under a licensed Bank
  6. Evidence of payment of company taxes for 3 years. If a company is newly incorporated, evidence that the company is a registered taxpayer.
  7. Passport Photograph of the applicant and means of identity.
  8. Evidence of application for TIN (this is for a newly incorporated company)
  9. Police Clearance of the 2 individual directors.
  10. Police Clearance of the Corporate body.


The Moneylenders License application procedure is a four-step process in Lagos State.

  • The first step is to make an application to the Commissioner of Police, Lagos State Police Command.                          The application includes
  1. A Cover letter.
  2. The Certificate of Incorporation.
  3. The Memorandum and Articles of the Company.

For an individual, an application letter and your valid means of identification will be required as well as your passport photograph.

This is to ensure that an investigation is carried out on the previous activities of the applicant. In the case of a newly registered Company, an investigation is carried out on the directors, to clear them of any criminal activities or any activities that may discredit their existence as moneylenders. After concluding her investigations, the Office of the Commissioner of Police issues a Clearance report either clearing the company or discrediting it as well as recommends the issuance of the license.

  • The second step involves an application to the Chief Magistrate’s Court located within the Magisterial District where the business is situated. Attached to the application are the following earlier listed documents;
  1. A Cover Letter.
  2. A copy of the Certificate of Incorporation.
  3. CTC of the Memorandum and Articles of Association.
  4. CTC of CAC Form 2 and Form 7.
  5. Tax clearance of the applicant’s company or proof of being a registered taxpayer
  6. Evidence of maintaining a current account with a licensed bank.
  7. The Police Clearance Report.

For an individual applying to the magistrate, your application should be accompanied with the following documents; tax clearance, evidence of maintaining a current account, and the police clearance report obtained from the command.

On approval of the application, Form B and Form C will be issued by the Chief Magistrate.

  • The third step is the application for the License at the Ministry of Home Affairs and Tourism of the Lagos State Government. The application includes
  1. A Cover Letter.
  2. Payment of N25, 000.00 (Twenty-five thousand Naira) for the purchase of the Application Form, (this form is to be filled and returned, alongside a regularization form issued upon payment).
  3. A copy of the Certificate of Incorporation.
  4. Certified True Copy of all Incorporation documents.
  5. Police Clearance Certificate from the Special Fraud Unit, Ikoyi, Lagos State for the individual applicant or two directors of the company showing fingerprints.
  6. FORM B and FORM C (as received from the Chief Magistrate’s Court).
  7. Reference Letter from the applicant’s bank.
  8. Tax Clearance Certificates or Pay As You Earn (P.A.Y.E) Certificate for three (3) years for the individual or at least two directors of the company.
  9. Tax Clearance for the Company if it has been in existence or a proof that the business is a registered taxpayer in the case of a newly registered Company.
  10. Payment of N200, 000.00 (Two Hundred Thousand Naira) for the registration of the Money Lender’s License fee.

This payment is made into the Lagos State Government account. Evidence of payment should be attached to the documents upon submission. Upon certification that the documents are complete, a file will be opened. The documents are archived in the file.

  • The fourth step is the inspection of the business premises by the appropriate officers. If the company is already engaged in the business, the inspection team will visit the registered office of the applicant, inspect the activities log/books, the premises, and question the staff of the applicant in line with their observations and the applicant’s business activities. If the Company is yet to resume business, the office premises and officers of the Company would satisfy demands.

Upon inspection, the inspection team submits its report and the Money Lenders License Certificate would be issued.

It usually takes a maximum of 8 weeks for a License to be obtained from the date of application to the date of approval and the license is renewed yearly.


With the current economic downturn facing the country as well as the stringent requirement of collateral by financial institutions before a loan can be given,  the business of Money lending is a welcome development that helps bridge the gap left by the worrisome collateral and interest rate posed by financial institutions.

There is no gainsaying that with every great development comes to a high-risk rate and to use the law as a shield and instrument of enforceability in a court, Moneylenders are expected to comply with the laid down rules, requirements, and procedure of the law, by obtaining a valid license to have recourse to the court to recover both the principal and interest from defaulters.



[1] Section 4 Money Lenders Law Chapter 7 Laws of Lagos State