By Stephen Simon
The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks across the country over their failure to comply with key regulatory requirements, in a move aimed at strengthening the stability of the nation’s financial system. The revocation, which took effect from July 1, 2026, is one of the largest regulatory actions against microfinance institutions in recent years.
The apex bank said the decision was approved by its Governor, Mr. Olayemi Cardoso, in accordance with the provisions of the Banks and Other Financial Institutions Act (BOFIA), 2020. According to the CBN, the affected institutions were found to have breached one or more regulatory requirements necessary for retaining their operating licences.
The CBN explained that the banks failed to meet prescribed prudential standards, including maintaining the statutory minimum capital requirement, sustaining adequate assets to meet liabilities, and complying with other operational and supervisory obligations. It added that some of the institutions had remained inactive for prolonged periods, while others failed to commence operations within the time stipulated by their licences or shut down without regulatory approval.
The regulator said the action forms part of its ongoing efforts to sanitise Nigeria’s financial sector, strengthen confidence in the banking system and ensure that only financially sound institutions continue to operate. It reaffirmed its commitment to protecting depositors and promoting a safe, stable and resilient financial system through effective supervision and enforcement of banking regulations.
Meanwhile, the Nigeria Deposit Insurance Corporation (NDIC) has commenced the liquidation process for the affected banks and is expected to begin the verification of insured deposits to facilitate payment to eligible depositors in line with its statutory responsibilities. The corporation said it would ensure an orderly resolution process designed to minimise the impact of the closures on customers.
Among the affected institutions are Gold Microfinance Bank, Creditville Microfinance Bank, Sycamore Microfinance Bank, NOW NOW Digital Microfinance Bank, Merchant Microfinance Bank, Abia SME Microfinance Bank, Chanelle Microfinance Bank, Apple Microfinance Bank, Frontline Microfinance Bank, OurPass Microfinance Bank, Avantus Microfinance Bank, Safegate Microfinance Bank, Entrepreneur Microfinance Bank, Crystabel Microfinance Bank, Bompai Microfinance Bank, Janmaa Microfinance Bank, Minji-Se Churchill Microfinance Bank, Bestar Microfinance Bank, Livingspring Microfinance Bank and Stanford Microfinance Bank, among others.
The affected banks are spread across 18 states and the Federal Capital Territory, with Kano accounting for the highest number at 13, followed by Lagos with eight. Others are located in Abia, Ogun, Anambra, Ondo, Osun, Bayelsa, Kwara, Rivers, Oyo, Akwa Ibom and several other states.
Financial analysts say the exercise underscores the CBN’s determination to strengthen regulatory oversight and restore confidence in Nigeria’s financial system by removing institutions that no longer meet minimum operational and prudential standards. They note that while the decision may inconvenience some customers in the short term, it is expected to promote greater stability and public confidence in the country’s banking industry over the long term.
