The Central Bank of Nigeria (CBN) has upgraded the licences of select FinTech companies and Microfinance Banks (MFBs) to national status, reflecting their expanded operations across the country.
Gatekeepers News reports that the announcement was made by Mr. Yemi Solaja, Director of the Other Financial Institutions Supervision Department (OFISD) at the CBN, during the recently concluded annual conference of the Committee of Heads of Banks’ Operations (CHBOs) in Lagos.
The move aims to align licensing frameworks with the operational footprint of these institutions, ensuring proper regulatory oversight as their services now span the entire nation.
At the CHBOs conference, Solaja encouraged collaboration between commercial banks and FinTechs to reduce the persistence of cash outside formal banking channels and to promote “Digital-First” banking operations.
“Institutions like Moniepoint MFB, Opay, Kuda Bank and others have already been upgraded,” Solaja stated. “In reality, their activities are now all over the country. Most of their customers are informal people. They need to know where to report to when there is a problem.”
He clarified that the upgrade is not automatic, with national licences granted only after institutions meet key regulatory benchmarks.
Bridging the Regulatory Gap
FinTechs and tech-driven MFBs have rapidly expanded in Nigeria through mobile technology and agent banking models. Many were initially licensed under unit, tier-one, or tier-two frameworks, restricting them to limited regions.
Despite these limitations, digital banks such as Kuda, Opay, Moniepoint, and Palmpay built nationwide user bases, creating a mismatch between their licence scope and actual operations. The CBN’s upgrade is part of an effort to formalize these operations and close regulatory gaps.
Balancing Digital Reach with Physical Presence
The regulator emphasized that national FinTechs and MFBs must maintain physical outlets in key areas, even as they operate digitally.
- Physical branches help resolve disputes and serve informal sector customers.
- These institutions maintain extensive agent networks across rural and urban Nigeria, which are crucial for cash flow management in underserved areas.
- The CBN believes that leveraging FinTechs’ reach can help address Nigeria’s persistent cash-outside-banks challenge.
Stricter Oversight and Capital Requirements
With the national licences, FinTechs and MFBs must comply with stricter capital and operational standards:
- National MFBs must maintain N5 billion in capital, up from N2 billion.
- Unit MFBs: Tier II – N50 million; Tier I – N200 million.
- State MFBs: N1 billion.
Major players like Opay, Moniepoint, Paga, and Kuda now operate under these regulations. In 2024, the CBN fined Moniepoint and Opay N1 billion each for breaches of KYC standards, highlighting the central bank’s commitment to stronger compliance.
The licence upgrade signals a broader regulatory strategy to formalize digital finance players, boost consumer trust, and deepen financial inclusion across Nigeria.
