The Central Bank of Nigeria (CBN) has officially lifted its ban on five major fintech companies—OPay, Moniepoint, Kuda, Palmpay, and Paga—allowing them to resume the onboarding of new customers. This decision comes approximately five weeks after the CBN initially imposed the ban due to concerns over illicit foreign exchange transactions being conducted through these platforms.
Announcement and Reactions
– OPay’s Announcement:
OPay confirmed the lifting of the ban through a post on its X handle, stating:
> “We are thrilled to announce that the Central Bank of Nigeria has given OPay the thumbs up to resume onboarding new users. This milestone highlights our dedication to following the rules, keeping your information safe and secure, and preventing any shady activities.”
OPay reiterated its commitment to adhering strictly to Know Your Customer (KYC) verification processes and urged its customers to ensure full compliance with all account verification requirements.
– Kuda’s Announcement:
Kuda also shared the news with its customers and followers via social media, mentioning:
> “As you probably already know, we’ve been working with the CBN to meet recent regulatory requirements by putting more account controls in place. Based on the work we’ve done, we’ll resume signing up new customers this week. Please, note that you’ll need your BVN, NIN, and your proof of address (followed by address verification) to open a Tier 3 account.”
Conditions and Compliance
To lift the onboarding freeze, the CBN had set several conditions that the fintech companies needed to fulfill by May 20, 2024. These included:
– Blocking peer-to-peer (P2P) crypto transfers.
– Mandating physical address verification for all account tiers.
– Updating facial verification procedures for customers.
The fintechs argued that most of the implicated accounts involved in crypto transactions belonged to commercial banks rather than fintech platforms. However, they complied with the CBN’s directives to enhance their KYC and fraud prevention measures.
Implications
The lifting of the ban marks a significant milestone for the fintech industry in Nigeria, emphasizing the importance of regulatory compliance in maintaining operational integrity. It also highlights the ongoing efforts of fintech companies to enhance security measures and adhere to stringent regulatory requirements to prevent illicit activities.
The resumption of customer onboarding by these fintech platforms is expected to boost their operations and customer base, contributing positively to Nigeria’s digital financial ecosystem. The developments also underscore the collaborative efforts between regulatory bodies and fintech companies to ensure a secure and compliant financial environment.
