Northern Irish police have arrested a taxi driver who appeared to hold one of his passengers at gunpoint.

Dashcam footage circulating online appears to show a FonaCAB taxi driver pointing a handgun in the direction of a front-seat passenger before threatening the passenger and hitting him with the weapon. 

The PSNI confirmed on Thursday evening that a 48-year-old man has been arrested on suspicion of a number of offenses connected to the incident, including possession of a firearm or imitation firearm. 

The man is currently in custody and the PSNI is calling on anyone with information about the incident to come forward. 

Meanwhile, FonaCAB said it was aware of the incident and said it is working with the PSNI and the Driver & Vehicle Agency (DVLA) to investigate the incident. 

The company also said it had terminated the driver's contract before footage of the incident circulated on social media. 

"The driver was identified and called this morning to present at the earliest opportunity/ASAP to FonaCab Head Office, at which time he was interviewed and his relationship with FonaCab immediately terminated," a FonaCAB spokesperson told BBC NI. 

"Our investigation was completed and our action taken before the footage was released on social media.

"Due to the nature of the content of the footage, it would be inappropriate to make any further comment on the footage while other investigations are undertaken."

The BBC reports that the incident took place in a car park in Holywood in County Down.

The incident reportedly relates to a dispute over a debt repayment. 

The driver can be heard telling the passenger that he will take his "legs off" if the debt was not repaid. 

A timestamp on the dashcam footage indicates that the incident took place on March 26.