CBN Revokes Licences of 46 Microfinance Banks, NDIC Begins Depositor Payout Process
The Central Bank of Nigeria has revoked the operating licenses of 46 microfinance banks due to various regulatory non-compliances, including insufficient assets and inactivity. The Nigeria Deposit Insurance Corporation has since commenced the liquidation process, including the payment of insured deposits to affected customers, urging cooperation from depositors.
The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks nationwide, effective July 1, citing persistent regulatory breaches and financial instability.
According to the apex bank, the affected institutions failed to meet key requirements, including maintaining adequate capital, meeting liabilities, obtaining approval before ceasing operations, and commencing business within the stipulated timeframe under the Banks and Other Financial Institutions Act 2020.
Kano recorded the highest number of affected banks with 13, followed by Lagos with eight, while the revoked institutions comprised 25 Tier 2, 18 Tier 1, and three state microfinance banks.
Following the licence revocations, the Nigeria Deposit Insurance Corporation (NDIC) assumed control of the failed banks as their statutory liquidator. The corporation has begun the liquidation process, including taking over the institutions, verifying claims, and paying insured deposits to eligible customers in line with the law.
It also warned members of the public against conducting transactions with the affected banks or tampering with their assets and records, noting that such actions are punishable under existing regulations.
Among the affected institutions are Gold Microfinance Bank, Bompai Microfinance Bank, Creditville Microfinance Bank, NowNow Digital Microfinance Bank, Safegate Microfinance Bank, Supreme Microfinance Bank, Verdant Microfinance Bank, Entrepreneur Microfinance Bank, and Avantus Microfinance Bank.
The CBN said the action forms part of its efforts to strengthen financial sector stability, improve regulatory compliance, and protect depositors, while the NDIC has assured customers that further updates on the claims and payout process will be communicated as the liquidation progresses.