The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks (MFBs) across the country following a series of regulatory and operational shortcomings. The decision, which became effective on July 1, 2026, forms part of the apex bank’s ongoing efforts to strengthen the nation’s financial system and ensure compliance with banking regulations.
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The announcement was made in a statement signed by the Acting Director of Corporate Communications, Mrs. Hakama Sidi-Ali, who disclosed that the action received the approval of the CBN Governor, Olayemi Cardoso, in line with the provisions of the Banks and Other Financial Institutions Act (BOFIA), 2020.
Reasons Behind the Revocation
According to the CBN, the affected microfinance banks failed to meet the regulatory standards required to continue operating as licensed financial institutions.
Some of the key issues identified include:
- Failure to maintain the prescribed minimum capital requirements.
- Inability to meet financial obligations due to weak asset positions.
- Suspension or closure of operations without obtaining prior approval from the regulator.
- Prolonged inactivity and discontinuation of banking services.
- Failure to commence business operations within the stipulated period after obtaining a licence.
The regulator noted that these lapses indicated that several of the institutions were no longer financially viable or capable of delivering the essential banking services expected of licensed microfinance banks.
Part of a Broader Regulatory Drive
The CBN explained that the latest enforcement action is aimed at reinforcing confidence in Nigeria’s banking industry by ensuring that only institutions with sound financial health and strong governance remain in operation.
The apex bank reaffirmed its commitment to protecting depositors, promoting financial stability, and enforcing compliance with existing banking regulations. It added that supervisory actions would continue to be taken against institutions that fail to meet statutory requirements.
States with the Highest Number of Affected Banks
Among the affected states, Kano recorded the highest number of licence withdrawals. Some of the impacted institutions include Bompai MFB, Now Now Digital MFB, Minjibir MFB, Sycamore MFB, Kanopoly MFB, Bellbank MFB, and Esteem MFB.
Lagos State also featured prominently on the list, with licences revoked for institutions such as Gold MFB, Chanelle MFB, Safegate MFB, Supreme MFB, Creditville MFB, MBAG MFB, Verdant MFB, and Entrepreneur MFB.
Other affected microfinance banks are located across Abia, Kebbi, Niger, Ogun, Kaduna, Plateau, Rivers, Bayelsa, Benue, Cross River, Delta, Ondo, Osun, Oyo, Anambra, and the Federal Capital Territory (FCT).
Implications for the Banking Sector
Microfinance banks play a significant role in expanding access to financial services for individuals, small businesses, and underserved communities across Nigeria. Their services are particularly important for promoting financial inclusion and supporting grassroots economic growth.
However, institutions that fail to meet prudential and operational standards can expose depositors to unnecessary risks and undermine confidence in the financial system.
The latest move by the CBN signals a continued commitment to improving the overall health of the country’s financial sector through stricter regulatory oversight. Industry stakeholders also expect increased emphasis on transparency, corporate governance, and adequate capitalization, especially as experts continue to advocate for greater disclosure of financial reports by deposit-taking fintech companies and microfinance banks.
With this action, the CBN has reaffirmed its resolve to ensure that only financially sound and compliant institutions are allowed to operate, ultimately strengthening public trust and enhancing the resilience of Nigeria’s financial system.
