Key takeaways
- The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks, effective July 1, 2026, as part of a regulatory crackdown on non-compliant lenders.
- The apex bank said the affected institutions failed to meet regulatory requirements, citing issues such as insufficient assets to cover liabilities, prolonged inactivity, and others.
- Fintech-linked institutions affected include Sycamore Microfinance Bank, NOW NOW Digital MFB, OurPass MFB, Creditville MFB, and Casha MFB.
The Central Bank of Nigeria (CBN) has explained why it revoked the operating licences of 46 microfinance banks (MFBs), stating that the institutions no longer met the conditions required to operate as licensed financial institutions.
The decision, which takes effect July 1, 2026, was approved by CBN Governor Olayemi Cardoso under Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.
According to the regulator, the move forms part of its efforts to strengthen oversight of Nigeria’s financial system, protect depositors, and ensure licensed institutions comply with prudential regulations.
Why the CBN acted
In its revocation order, the CBN listed several reasons why the affected institutions lost their licences. These include having insufficient assets to meet liabilities, shutting down operations without regulatory approval, and prolonged inactivity or cessation of financial intermediation.
The regulator also cited failure to commence operations within twelve months of receiving a licence and failure to maintain the minimum capital required to continue operating as a microfinance bank. Rather than attributing every violation to every institution, the CBN noted that each licence was revoked for one or more of these grounds.
The apex bank said the enforcement action reflects its commitment to maintaining a “safe, sound and resilient financial system” and preserving public confidence in Nigeria’s banking sector.
This latest development by the CBN comes weeks after it issued a six-month notice period to banks and fintechs, within which it mandated them to localise payment data. A move that has raised concerns from industry experts.
Fintech-linked institutions caught in the purge
While most of the affected institutions are relatively small microfinance banks, the list also includes several lenders with links to Nigeria’s fintech ecosystem.
Among them are Sycamore Microfinance Bank, NOW NOW Digital Microfinance Bank, OurPass Microfinance Bank, Creditville Microfinance Bank, and Casha Microfinance Bank. Their inclusion quickly drew attention because of their association with technology-driven financial services.
Victoria Fakiya – Senior Writer
Techpoint Digest
Stop struggling to find your tech career path
Discover in-demand tech skills and build a standout portfolio in this FREE 5-day email course
However, not all the companies behind these brands are shutting down.
Sycamore clarified that the revoked licence belonged to a microfinance bank it acquired in 2024 as part of its regulatory transition. According to the company, it has since obtained a finance company licence from the CBN, rendering the acquired MFB licence redundant. The company said its operations remain unaffected and customers can continue using its services as usual.
Tightening oversight of the financial sector
The latest revocations underscore the CBN’s increasingly strict approach to supervising financial institutions amid broader reforms aimed at improving governance and financial stability.
Microfinance banks play a critical role in extending financial services to underserved individuals and small businesses. But the sector has also struggled with undercapitalisation, governance challenges, and weak operational performance, prompting closer regulatory scrutiny in recent years.
For fintechs that operate through regulated banking entities, the development also highlights the importance of maintaining the appropriate regulatory licence as business models evolve. In Sycamore’s case, the company said its current finance company licence—not the acquired MFB licence—forms the basis of its ongoing operations.
