CBN Revokes Microfinance Bank Licences: 46 Institutions Shut Down Nationwide
Quick Reads:
- CBN revokes microfinance bank licences of 46 institutions under BOFIA 2020
- Kano leads with 13 revoked banks, Lagos follows with 8
- Reasons include insolvency, dormancy, and unlicensed closures
- 25 Tier 2, 18 Tier 1, and 3 State microfinance banks affected
In a sweeping regulatory move, the Central Bank of Nigeria (CBN) has revoked microfinance bank licences belonging to 46 institutions across the country, citing persistent failure to meet operational and financial requirements. The apex bank announced the development on Wednesday, invoking its powers under Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.
According to the CBN, the affected microfinance banks either had insufficient assets to cover their liabilities, shut down operations without regulatory clearance, or simply went inactive, ceasing all forms of financial intermediation. Others were flagged for failing to commence business within 12 months of receiving their licences, while some could not maintain the minimum capital funds required to stay unimpaired by losses.
Kano State bore the brunt of the CBN’s decision to revoke microfinance bank licences, accounting for 13 of the affected banks — the highest in the exercise. Lagos followed with eight banks losing their operating permits. Other states, including Abia, the Federal Capital Territory, Kaduna, Kebbi, Niger, Ogun, and Plateau, each recorded two revocations, while Anambra, Akwa Ibom, Bayelsa, Benue, Cross River, Delta, Kwara, Ondo, Osun, Oyo, and Rivers each had one bank affected.
A breakdown by category shows that 25 of the shuttered institutions were Tier 2 microfinance banks, 18 were Tier 1, and three operated as State microfinance banks. Among the names on the list are Gold MFB, Bompai MFB, Creditville MFB, Verdant MFB, and Chanelle MFB, all based in Lagos, alongside several Kano-based lenders such as Minjibir MFB, Shanono MFB, and Sumaila MFB.
The CBN described the exercise as part of its ongoing effort to strengthen oversight of Nigeria’s financial system and ensure licensed institutions comply with existing laws and prudential guidelines. This latest action adds to a string of regulatory interventions the apex bank has carried out in recent years as it tightens supervision of the microfinance banking sub-sector, which serves millions of low-income and unbanked Nigerians.
Customers and stakeholders linked to any of the 46 affected banks are advised to reach out to the Nigeria Deposit Insurance Corporation (NDIC) for guidance on deposit claims and next steps.
