LemFi Suspends Operation in Ghana Due to Regulatory Challenges

LemFi, a pan-African-focused fintech startup catering to banking and remittance services for immigrants, has suspended its operations in Ghana, citing regulatory issues.

The fintech startup’s suspension of its services in the West African country, is in response to the Central Bank of Ghana’s clampdown on unlicensed remittance providers in the country.

Announcing this move, the company wrote on X, 

“We regret to inform you that we are suspending all services to Ghana. As a result, you will be unable to send money to banks and mobile money in Ghana. We recognize that this change will bring about some inconvenience, and we sincerely apologize. We are appreciative of your business and your support. If anything changes in the future, you will be the first to know.”

Recall that last week, the Bank of Ghana rolled out the list of eight remittance providers that are operating in the country’s foreign exchange market without approval. 

LemFi was one of those providers, with several others which include Xoom, Wise, TransferGo, Boss Revolution, Aza Finance Supersonicz, and Sendvalu.

In a statement, the secretary of Ghana’s Central Bank, Sandra Thompson, mandated all financial institutions in the country to desist from operating with unlicensed providers. 

In her words,

“Approved MTOs are hereby reminded to terminate their foreign exchange flows through their partner institutions only and to adhere strictly to all guidelines in respect of their operations”.

It is worth noting that Section 3.1 of Ghana’s Foreign Exchange Act, 2006 (Act 723), explicitly prohibits individuals and organizations from participating in the forex market without obtaining a license as per the provisions of this Act.

Furthermore, according to section 15.3 of the Act, any transfer of forex to or from Ghana must be conducted through a licensed entity authorized to engage in money transfers or any other approved dealer.

While LemFi has contributed to the growth of Fintech in Ghana, its recent suspension of operations in the country will no doubt pose a challenge to its users.

Founded in 2020 by Rian Cochran and Ridwan Olalere, LemFi enables users to receive and send money internationally to over 12 plus countries instantly at Zero fees.