CBN Cracks Down on Fintechs Over Alleged Forex Violations: Impact on OPay, Palmpay, Kuda Bank, Moniepoint

The Central Bank of Nigeria (CBN) has directed four fintech companies, OPay, Palmpay, Kuda Bank, and Moniepoint, to stop accepting new customers until further notice.

These fintechs are under scrutiny for allegedly facilitating illicit foreign exchange transactions. Representatives from two companies acknowledged the CBN’s directive in connection to these claims, stating that most of the implicated accounts are with commercial banks, not fintech platforms.

Recently, the Economic and Financial Crimes Commission (EFCC) obtained a court order to freeze a minimum of 1,146 bank accounts belonging to individuals and companies suspected of engaging in illegal foreign exchange activities.

The EFCC sought to secure the funds in the identified bank accounts until the investigation is concluded and potential prosecution initiated.

Despite the court-ordered freeze, the majority of accounts involved in the purported illegal forex trading were held by commercial banks.

According to a source in the fintech industry, there exists a more robust and favorable relationship between banks and the CBN when compared to fintech companies.