The verdict in three sentences
To sell online legally in Nigeria, you need a registered business with an RC number and a TIN. The CAC online portal centralizes the formalities: depending on the structure you choose, expect NGN 10,000-30,000 and a timeline of 1 to 3 days. Without these documents, no payment aggregator (Paystack, Flutterwave, OPay merchant) will approve your account.
Business Name or Limited: which to choose?
Most online sellers start as a Business Name (sole trader) or a Private Limited Company (Ltd). Here are the 2026 differences.
| Structure | Owners | Minimum capital | Liability | Best for |
|---|---|---|---|---|
| Business Name | 1 | None | Unlimited (personal assets) | Testing, very small volume |
| Private Limited (Ltd) | 1+ | NGN 100,000 (nominal) | Limited to shares | Serious solo e-commerce |
| Ltd by Guarantee | 1+ | None | Limited | NGO / non-profit |
| PLC | 2+ | NGN 2,000,000 | Limited | Large / listed |
The Private Limited (Ltd) is the most common serious choice: limited liability, credibility with suppliers and banks, and full access to payment gateways.
Real cost and time via CAC
The CAC online portal has cut fees and delays. Here is a 2026 order of magnitude for a Business Name and an Ltd.
| Item | Estimated 2026 cost | Timeline |
|---|---|---|
| Business Name registration | NGN 10,000-15,000 | 1-2 days |
| Ltd registration (small) | NGN 25,000-35,000 | 1-3 days |
| TIN issuance | Free | Automatic |
| Name reservation | NGN 500-1,000 | Same day |
| Total Business Name | NGN 10,000-16,000 | 1-2 days |
| Total Ltd (self-service) | NGN 26,000-36,000 | 1-3 days |
The TIN (tax ID) and the RC number (registration number) are the two keys. Once obtained, you can open a corporate account and enable a merchant payment gateway.
Why going formal unlocks online payments
Paystack, Flutterwave and OPay merchant all require an RC number and TIN for compliance (business KYC). Staying informal forces you to collect on a personal number, with low limits, freeze risk and no valid invoices. Formalizing is the entry key to serious e-commerce.
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Mini case study
Chioma launches a natural-cosmetics store in Lagos. She hesitates between staying informal and registering an Ltd.
- Ltd cost via CAC self-service: ~NGN 30,000, obtained in 3 days
- With her RC number + TIN, she opens a corporate account and enables Paystack: high merchant limits, valid invoices
- She now collects around NGN 2,500,000/month online, with compliant invoices for her B2B clients
- Bonus: she becomes eligible for grants and MFI loans, impossible without registration
For NGN 30,000 and 3 days, Chioma moved from an informal seller to a banked, credible and financeable business.
FAQ
Do you need a large starting capital? No. For a small Ltd, the nominal share capital (often NGN 100,000) does not have to be paid up in cash to register. The real cost is the CAC filing fee, not the capital.
How long before I get my RC number? Via the CAC portal, a Business Name is often issued within 1-2 days and an Ltd within 1-3 days. The TIN is generated automatically alongside registration.
Can I do it all online? Yes, most of the CAC journey is now digital via the portal. Using an accredited agent (a modest fee) is helpful to secure your articles and save time if paperwork is not your strength.
Do I need a business address? Yes, you must declare a registered office. A home or a virtual office address can suffice at launch, as long as it is verifiable.
What happens if I stay informal? You cannot enable a merchant gateway, issue legal invoices, or access formal financing. You also expose yourself to penalties in a tax audit.
Let's talk about your project. We point you to the right structure and connect your store to the payment gateways. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
