The Central Bank of Nigeria (CBN) has ordered four fintech companies to suspend the onboarding of new customers until further notice.
This new directive affects Opay, Palmpay, Kuda Bank, and Moniepoint, as they have been under vigilance due to allegations of some of their accounts being used for illegal foreign exchange transactions, money laundering, scams, and fraudulent activities.
Some accounts have been suspended as Know Your Customers (KYC) issues linger.
This is coming two days after the Economic and Financial Crimes Commission (EFCC) blocked 1,146 bank accounts involved in unauthorized foreign exchange dealings.
The EFCC also investigates other offences, including money laundering and terrorism financing.
However, their concern is that the directive might be misdirected, as some of the accounts affected are held by commercial banks rather than Fintech platforms.
The EFCC stated that the account freeze is still in its preliminary investigation shows that the accounts were linked to individuals allegedly leveraging virtual cryptocurrency exchange platforms to manipulate the Naira’s value illegally and launder proceeds from unlawful activities.
It cited the necessity to preserve the funds in the identified accounts pending the investigation’s conclusion and potential prosecution.
Some bank customers have expressed panic as the Central Bank of Nigeria bans mobile money operators including Fintech companies from onboarding new customers.
The Bank Customers Association of Nigeria has backed the directives to suspend new account openings on the platforms affected since some firms are not complying with the rules of engagement of the financial institutions as it concerns KYC. The CBN has yet to give its final verdict on this compliance issue and bans on the affected Fintechs.
