The Central Bank of Nigeria has banned OPay, Palmpay, Kuda Bank, and Moniepoint from onboarding new customers following allegations of accounts being used for illicit foreign exchange transactions
The ban is aimed at preventing manipulation of funds through virtual cryptocurrency exchanges and preserve proceeds of unlawful activities. The investigation is intended to be done within 90 days.
According to a representatives from the fintechs,90% of the accounts implicated in the illicit forex transactions are with commercial banks, and only 10% are with fintechs.The CBN has however not extended this directive to the commercial banks and therefore targeting fintechs seems like an unfair focus on the more vulnerable targets.
As part of the process,Justice Emeka Nwite, of the Federal High Court Abuja granted the Economic and Financial Crimes Commission an interim order to freeze 1,146 bank accounts linked to individuals and companies being investigated for unauthorised forex dealings, money laundering and terrorism financing.
The ban will target new accounts as a measure to combat money-laundering activities, which have contributed to the recent decline in the naira’s value against the dollar.
The affected companies have however refuted the claims terming the directive misdirected, as the majority of the implicated accounts belong to commercial banks, not fintech platforms.
On Friday, Moniepoint stated that they had temporarily paused new sign-ups on their platform on its platform and could not onboard new customers.
OPay has also communicated to its customers stating that they have closed non-compliant accounts, implemented strict security measures, and educated customers to help combat fraud.
