mistakes to avoid when registering a business with CAC

In this post, we’ll be talking about common mistakes to avoid when registering your business with CAC in Nigeria. CAC stands for Corporate Affairs Commission and is a body that oversees the registration of businesses and filing of annual returns in Nigeria.

Can I register my business on my own?

Well, if you are acquainted with all it takes to register your business with CAC on your own, you can do that. However, we wouldn’t recommend such because of mistakes that you might run into later.

The cost of correcting such mistakes in most cases is enough to register a new business. In the end, it might turn out to be a penny-wise pound-foolish venture.
But if you want to give it a try, here are some of the costly common mistakes, you should avoid.

1. Address Mismatch

Address mismatch is usually caused when you register your business and input a business address that is not traceable. Now CAC wouldn’t reject or query the address, they will actually accept it and get your business registered. However,  in due time, you might want to get a corporate account for your business.

In the course of doing so, your bank will ask you to provide a means to verify the address on your CAC certificate. You are required to get something like an electricity bill bearing the same address, you provided with CAC.

When that happens, you’ll find out that you cannot provide a bill whose address matches the business address you provided with CAC.
In that case, it means that you have to go back to CAC to correct the address you first submitted and that actually means a huge cost.

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2. Name and Nature of Business

It’s true that you are allowed to choose any business name of your choice, as long as it’s not already in use. But some “name” and “nature of business” choices can land you into a challenge you never bargained for.

Let me use the below example to explain this. Let’s say Mrs. Adesina wants to register her business with CAC and chooses Chopsy bakes and cakes as her business name. Then in inputting the nature of her business, she inputs baking, event coverage, and consultancy as her nature of business.

Note, she did not add consultancy in her nature of the business because she is a business consultant, but because she is highly knowledgeable in her business and also feels she can handle any consultant service regarding the business.
Once that happens and she gets her CAC application form submitted. CAC will not query the application and proceed to issue the certificate.  Great!

A Mistake Indeed!

Now tomorrow, Mrs. Adesina may want to open a corporate account for her business. Then as she provides the documents for the account opening (including the CAC certificate).

The bank will quickly notice the consultancy attached to her certificate’s nature of business. Consequently, she will be notified that by reason of the consultancy attached to her nature of business, her business is now one of the Designated Non-financial institutions (DNFI) in Nigeria

As such, she is required to get a SCUML certificate from EFCC. Behold that’s the beginning of Mrs. Adesina’s challenge.  In an effort to get the SCUML certificate from EFCC, she will need to provide a Professional certificate in Consultancy and Mrs. Adesina does not have anything like that and never bargained for such.

At this point, it dawns on her that she has made a huge mistake by registering her business with CAC on her own. The cost of correcting these mistakes is a lot costlier than the extra token she could have paid a certified CAC agent to help her get it perfect at first.

The Lesson

There are lots of costly mistakes a novice can make while trying to register his/her business on her own. We just listed a few above.

If you have all the expertise to avoid these mistakes, you can proceed and register your business on your own. If not, we encourage you to get the services of a CAC accredited agent, to assist you in getting the job well done.

And that’s exactly one of the services we render at zfrica.com. Feel free to contact us today to assist you in registering your

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  1. Good morning sir /ma’am
    Please and please If I mistake date of birth in cac account creation, is there any problem in foresight with the name I registered with that account ?

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