Four Nigerian Fintech Firms Suspend Account Opening For New Customers Following CBN Directive

Following a directive from the Central Bank of Nigeria (CBN) four Fintech firms Kuda Bank, Moniepoint, OPay, and Palmpay have temporarily halted the opening of new accounts for customers. 

This directive came shortly after the Economic and Financial Crimes Commission (EFCC) blocked 1,146 bank accounts linked to unauthorized.

A notice on one of the fintech firm websites reads,

“We’ve temporarily paused new signups on our platform. This means that you’ll be unable to open a new account at the moment. We apologize for any inconvenience this may cause”.

An executive at one of the affected fintech firms stated that last week’s directive to halt account opening is connected to an ongoing audit of the Know Your Customer (KYC) process. The executive described the pause as “temporary.”

Also commenting on the CBN’s directive, public relations manager of Palmpay, Enitan Tanimowo, however clarified that the specifics of the directive are not yet public.

“We received the directive, just like other fintech companies. However, the CBN has not yet issued a full public statement outlining the details for customers, investors, and the general public,” she said.

She however emphasized PalmPay’s commitment to finding the right balance between growth and security, noting that the company will fully support implementing effective measures to mitigate risks.

Notably, on April 26, the CBN and the National Security Agency (NSA) held talks with representatives of the affected fintechs.

A source knowledgeable with the CBN directive revealed that the Apex bank feels like a lot of crypto traders were leveraging the fintech platforms to disrupt the FX market. 

Meanwhile, one of the affected fintechs disclosed that the CBN’s directive is linked to the EFCC’s ongoing investigation into bank accounts involved in unauthorized FX dealings. However, an analysis of the 1,146 accounts blocked by the EFCC shows that only 10% are operated by fintechs, with the majority being commercial bank accounts.