The Central Bank of Nigeria (CBN) has revoked the operating licenses of 46 Microfinance Banks (MfBs), effective July 1, 2026, for failing to meet regulatory requirements. The decision was announced in a statement by the Acting Director of the Corporate Communications Department on Wednesday in Abuja.
Legal basis and approval
The action was taken under sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020, which grant the CBN authority to revoke licenses for non-compliance. CBN Governor Mr. Olayemi Cardoso approved the revocation after the banks failed to satisfy conditions for continued operation as licensed financial institutions.
Reasons for revocation
The revocation order cited several circumstances: insufficient assets to meet liabilities, closure of operations without CBN approval, inactivity or cessation of financial intermediation, failure to commence operations within 12 months of license approval, and failure to maintain minimum capital funds unimpaired by losses. These factors rendered the banks unable to operate safely and soundly.
CBN's commitment to stability
According to the statement, “The revocation of the licenses is part of CBN’s ongoing efforts to safeguard the stability of the financial sector, protect depositors, and ensure that licensed institutions comply with current laws and regulatory requirements. The CBN remains committed to promoting a safe, sound and resilient financial system. It will continue to take appropriate supervisory and regulatory actions, where necessary, to maintain public confidence in the Nigerian financial system.”
Impact on depositors and sector
The CBN assured that it is taking steps to protect depositors' interests, though specific details on deposit insurance or resolution measures were not provided. The revocation is expected to reduce the number of operating microfinance banks, potentially affecting access to financial services in some communities. The CBN emphasized that the move is necessary to weed out non-compliant institutions and strengthen the overall financial system.
