46 Microfinance Banks Lose CBN Licences—Here’s What Went Wrong – M

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The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks (MFBs), citing failure to meet key regulatory and prudential requirements

The revocation, which took effect on July 1, 2026, was approved by CBN Governor Olayemi Cardoso under Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020

According to the apex bank, the affected institutions were found to have breached one or more regulatory conditions required to operate as licensed financial institutions. These include inadequate assets to cover liabilities, operating without the required minimum capital, prolonged inactivity, shutting down operations without regulatory approval, and failure to commence business within 12 months of obtaining a licence

The CBN said the action is part of its ongoing efforts to strengthen oversight of Nigeria’s financial system, safeguard depositors’ funds, and ensure compliance with prudential regulations. The regulator added that the enforcement exercise is aimed at maintaining a safe, sound, and resilient banking sector while preserving public confidence

Among the affected institutions are fintech-linked lenders, including Sycamore Microfinance Bank, NOW NOW Digital Microfinance Bank, OurPass Microfinance Bank, Creditville Microfinance Bank, and Casha Microfinance Bank

Following the announcement, Sycamore clarified that the revoked licence belonged to a microfinance bank it acquired in 2024 during its regulatory transition. The company said it now operates under a CBN-issued finance company licence, making the acquired microfinance bank licence unnecessary. It assured customers that its services remain unaffected

 

The latest action reflects the CBN’s stricter regulatory approach as it pushes for stronger governance and greater stability across Nigeria’s financial sector

Microfinance banks remain a keybusinesses. However, persistent challenges such as weak capitalisation, poor corporate governance, and operational inefficiencies have continued to attract increased regulatory scrutiny. The development also highlights the need for fintech companies operating through regulated financial institutions to maintain the appropriate licences as their business models evolve

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