Central Bank of Nigeria (CBN) has announced revocation of the operating licences of 46 microfinance banks (MFBs) for failing to comply with key regulatory requirements.

This is also as the Nigeria Deposit Insurance Corporation (NDIC) said it has commenced the process of orderly closure of the affected MFBs.

According to the regulatory bank, the action is also aimed at boosting stability of the country’s financial system and protecting depositors.

CBN, which announced the decision in a statement issued, Wednesday, and signed by its Acting Director of Corporate Communications, Hakama Sidi-Ali, stated that the revocation of the affected MFBs’ licenses takes immediate effect.

The CBN explained that the action was taken pursuant to its powers under Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020, following the discovery of serious regulatory infractions by the affected institutions.

According to the bank, the affected microfinance banks failed to meet the conditions required to continue operating as licensed financial institutions, making regulatory intervention necessary.

It noted that routine supervisory activities revealed persistent violations of banking regulations, prompting the decision to withdraw their licences.

The CBN stressed that the action forms part of its ongoing efforts to strengthen confidence in the banking sector and ensure that only financially sound institutions remain in operation.

The bank identified several infractions that informed the decision, including inadequate assets to meet liabilities, prolonged inactivity, cessation of financial intermediation, closure of operations without regulatory approval, failure to commence business within 12 months of obtaining licences, and inability to maintain the statutory minimum capital unimpaired by losses.

It explained that these deficiencies rendered the affected institutions unable to effectively perform their obligations as licensed financial institutions.

CBN added that strict compliance with prudential guidelines remains essential to maintaining the integrity and stability of Nigeria’s financial system, as it further affirmed commitment towards that goal.

“The revocation of the licences is part of the bank’s ongoing efforts to safeguard the stability of the financial sector, protect depositors, and ensure that licensed institutions comply with current laws and regulatory requirements,” the statement read.

The bank reaffirmed its commitment to promoting a safe, sound and resilient financial system, adding that it would continue to take appropriate supervisory and regulatory actions whenever necessary to preserve public confidence in Nigeria’s banking industry.

The CBN also released the full list of the 46 affected microfinance banks whose operating licences have now been withdrawn, bringing an end to their operations as licensed financial institutions in the country.

Meanwhile, the Nigeria Deposit Insurance Corporation (NDIC) has cautioned against unauthorized transactions with the affected banks closed by the CBN on Wednesday.

The NDIC while noting that it has been appointed as the official Liquidator, pursuant to Section 12 (2) of BOFIA 2020, and Section 55 (1 & 2) of the NDIC Act 2023, announced that the affected institutions are no longer authorized to conduct banking business in Nigeria.

In a statement issued following the revocation, the NDIC stated that “members of the public are strongly advised against any unauthorized transaction with the closed banks, or any attempt by individuals to remove, conceal, retain, or interfere with the assets, records, or properties of the banks, as this may constitute a violation of the law that could attract appropriate legal consequences.

“The NDIC has commenced the process of the orderly closure of the failed banks with their immediate takeover, verification and payment of insured sums to eligible depositors. Depositors and the general public would be duly informed on an ongoing basis on further steps to be taken regarding the liquidation exercise.”

The affected MFBs include:

Minji-Se Churchill MFB (Rivers)

Merchant MFB (Abia)

Janmaa MFB (Kwara)

Busu MFB (Niger)

Gold MFB (Lagos)

Zain MFB (formerly Dawakin Tofa MFB) (Kano)

Bompai MFB (Kano)

Ajwa MFB (Kano)

Now Now Digital MFB (Kano)

Crystabel Microfinance Bank (Bayelsa)

Chanelle MFB (Lagos)

Abia SME MFB (Abia)

Kamba MFB (Kebbi)

Iwade MFB (Ogun)

Winview MFB (Abuja)

Zuru MFB (Kebbi)

Minjibir MFB (Kano)

Shanono MFB (Kano)

Sumaila MFB (Kano)

Rimin Gado MFB (Kano)

Mwaghavul MFB (Plateau)

Sycamore MFB (Kano)

TOFA MFB (Kano)

Safegate MFB (Lagos)

Creekline MFB (Delta)

Bestar MFB (Oyo)

Livingspring MFB (Cross River)

Apple MFB (Ogun)

Stanford MFB (Uyo, Akwa Ibom)

Frontline MFB (Anambra)

Zafec MFB (Kaduna)

Supreme MFB (Lagos)

Bejin-Doko MFB (Niger)

Kanopoly MFB (Kano)

Bellbank MFB (formerly Tsanyawa MFB) (Kano)

Yeneng MFB (Plateau)

Creditville MFB (Lagos)

MBAG MFB (Lagos)

Straight Sahara MFB (Benue)

Our Pass MFB (Ondo)

VERDANT MFB (Lagos)

Basawa MFB (Kaduna)

Casha MFB (Abuja)

Esteem MFB (Kano)

Enterpreneur MFB (Lagos)

Avantus MFB (Osun)