Due Diligence on a Nigerian Supplier Before You Pay

Before you pay a new Nigerian supplier, confirm one thing first: that it is a real, active, registered company whose legal name matches the invoice and bank account you are about to fund. The fastest way to start is free, pull the supplier's CAC record on Fylings, then work through the checks below. You can search the supplier free by name and read its registration status, RC or BN number, incorporation date, type, and nature of business in under a minute, with a source and a last-verified date attached.

This guide is written for the person who signs off the payment, procurement, finance, or compliance, vetting a vendor they have never paid before. It walks through what to check, in what order, and when a free record is enough versus when to escalate to a full verification report or wire the checks into your onboarding via API.

Why supplier due diligence matters in Nigeria

Most Nigerian suppliers are legitimate businesses doing real work. But cross-border buyers and local finance teams face a few recurring problems: invoices issued under a trading name that does not match any registered entity, "companies" that are actually unregistered or dormant, bank account names that differ from the supplier's legal name, and freshly incorporated shells set up to receive a single large payment and disappear. None of these are exotic, they are the ordinary failure modes of paying someone you have not met. Five minutes of structured checking removes most of the risk, and almost all of it can begin from a free public record.

Due diligence is proportional. A NGN 80,000 stationery order does not need beneficial-ownership tracing. A first payment of tens of millions to a new vendor does. The checklist below is ordered so that the cheap, fast checks come first and the deeper, paid checks only kick in when the deal size or sector warrants them.

The supplier due diligence checklist

Work top to bottom. Stop and ask questions the moment something does not reconcile.

1. Confirm the RC or BN number and the exact legal name. The number should resolve to an entity whose name matches the one on the invoice, contract, and letterhead, character for character.
2. Check the status is active, not dormant, inactive, struck off, or in liquidation.
3. Verify the incorporation date is consistent with how the supplier describes itself. A firm claiming "15 years in the industry" that was registered last year is a flag.
4. Match the business type and nature of business (e.g. limited company vs business name; trading vs manufacturing) to what they actually claim to do for you.
5. Confirm a TIN exists for the entity, a registered, tax-active company should have one.
6. Check the bank account name matches the registered legal name (or a clearly linked entity you have verified). This is the single highest-value check.
7. For higher-value deals, identify the directors and beneficial owners and sanity-check them against the people you are dealing with.
8. For regulated sectors or large sums, run sanctions and PEP screening on the company and its principals.
9. Confirm a physical address exists and is plausible for the type of business.
10. Weigh the age of the company against the size of the contract, a brand-new entity asking for a large upfront payment deserves extra scrutiny.

Step 1: Check the registration (CAC record)

Every legitimate Nigerian business should be registered with the Corporate Affairs Commission (CAC). Limited companies carry an RC number; registered business names carry a BN number. Start by searching the supplier on Fylings and confirming three things: the entity exists, the registration number on your invoice matches the record, and the legal name matches exactly. Watch for near-misses, "Adeyemi Global Ventures Ltd" on the invoice but "Adeyemi Global Resources Ltd" on the record is not a typo to wave through.

If the supplier sent you a scanned CAC certificate, treat it as a claim, not proof. Certificates are easy to forge or doctor. Verify the number against the live record instead of trusting the PDF, see how to check CAC registration and spot a fake CAC certificate for the specifics. For broader context on Nigerian company data, the Nigeria hub is the place to start.

Step 2: Confirm the status is active

A matching name and number is not enough, the entity also has to be in good standing. The status field tells you whether the company is currently active or whether it is dormant, inactive, or has been struck off the register. Paying a struck-off entity means paying something that legally is not trading, with no recourse if the deal sours. Fylings shows the status alongside a last-verified date and a confidence indicator, so you know how fresh the underlying data is rather than guessing.

Step 3: Identity and name-match

This is where most supplier fraud is caught. You are reconciling four things: the legal name on the CAC record, the name on the invoice, the name on the contract, and the name on the bank account. They should all line up. Common, legitimate complications include a business operating under a registered business name (BN) while invoicing under a related limited company, or a group with multiple entities. That is fine, as long as you can trace each name back to a verified registration and you have written confirmation of which entity you are actually contracting with and paying. If you cannot draw that line cleanly, do not pay yet.

Step 4: TIN and tax identity

A Tax Identification Number (TIN) is issued to registered businesses for tax purposes. A genuine, operating company should have one, and confirming it exists is a useful signal that the entity is a real taxpaying business rather than a paper shell, it also matters for your own withholding-tax and reporting obligations on the payment. Fylings surfaces the TIN as part of the company record where available; for the step-by-step, see verify a TIN. Note that a TIN confirms tax registration, not solvency or good behaviour, it is one input, not the whole picture.

Step 5: Directors and beneficial owners, when to go deeper

For small, low-risk orders, the public registration checks above are usually proportionate. For larger contracts, recurring relationships, or anything in a regulated sector, you want to know who actually owns and controls the company. Directors and shareholders, plus beneficial-ownership information, let you check that the people you are negotiating with are genuinely tied to the entity, screen those individuals, and spot conflicts of interest or hidden common ownership across "competing" bidders.

On Fylings, director and shareholder details are available on demand through licensed KYB (Know Your Business) verification, a paid step, because it draws on regulated identity data rather than the free public record. That is the right tradeoff: you run the free checks on every vendor, and pull ownership data only on the deals where it changes your decision. If you are new to the concept, what is KYB explains how business verification works and where it fits alongside KYC.

Red flags to watch for

Any one of these warrants a pause; two or more together should stop the payment until resolved:

• The bank account name does not match the registered legal name, and the supplier cannot explain why in writing.
• Pressure to pay quickly, pay upfront, or pay to a "temporary" or personal account.
• An RC or BN number that does not resolve, resolves to a different name, or resolves to a struck-off entity.
• A company incorporated very recently that is requesting a large first payment.
• A nature of business on the record that has nothing to do with what they are selling you.
• A scanned certificate offered as proof, with reluctance to let you verify the number independently.
• No verifiable physical address, or an address that does not fit the claimed scale of operations.
• Inconsistent legal names across the invoice, contract, email signature, and certificate.

When to escalate to a full verification report

Escalate beyond the free record when the stakes justify it: large or first-time payments, long-term or sole-source suppliers, regulated sectors with sanctions and PEP obligations, or any deal where a red flag surfaced. A verification report consolidates the registration, status, identity, ownership, and screening checks into a single dated, sourced document you can attach to the payment file, useful both for the decision itself and for your audit trail when someone asks later why this vendor was approved. It turns "I think we checked" into evidence.

Automating vendor checks with an API

If you onboard suppliers regularly, doing this by hand does not scale. The Fylings API lets you wire company verification directly into your procurement or vendor-onboarding workflow: validate the RC or BN number and legal name at the point a vendor is created, confirm active status before a purchase order is approved, run name-match against bank details automatically, and flag anything that fails for human review. The free public-record checks become an automatic gate on every new vendor, and the paid KYB and report steps trigger only on the high-value cases your rules define, consistent, logged, and fast.

Start free, escalate when it matters

Good supplier due diligence is not a heavy compliance project, it is a short, ordered set of checks you run before money moves. Begin every vendor the same way: search the supplier free on Fylings, confirm the registration, status, name-match, and TIN, and resolve any red flag before you pay. When the deal size or sector calls for it, escalate to licensed KYB ownership data and a full verification report, or wire the whole flow into your onboarding with the Fylings API so your team never pays an unverified company again. Free to start, built to scale.