NDIC warns Nigerians against transactions with 46 closed microfinance banks, begins deposit verification
By Aboki Forex —
The Nigeria Deposit Insurance Corporation (NDIC) has issued a strong warning to depositors and the general public following the revocation of the operating licences of 46 microfinance banks by the Central Bank of Nigeria (CBN). The NDIC has assumed the role of liquidator and has begun the verification process for insured deposits.
The agency urged Nigerians to avoid carrying out any form of transaction with the affected financial institutions, stressing that the banks have ceased operations and are no longer legally permitted to offer banking services. The warning comes barely a day after the CBN announced the withdrawal of the licences as part of its efforts to strengthen the country's financial system and protect depositors.
NDIC takes over as liquidator, warns against asset tampering
In a statement released after the licence revocations, the NDIC disclosed that it has officially assumed responsibility as the liquidator of the failed banks in line with the provisions of Section 12(2) of the Banks and Other Financial Institutions Act (BOFIA) 2020 and Sections 55(1) and 55(2) of the NDIC Act 2023. According to the corporation, the affected banks no longer have the legal authority to conduct banking operations in Nigeria.
The NDIC noted that it has immediately commenced the process of taking over the institutions to facilitate an orderly liquidation and ensure that depositors receive their insured funds as quickly as possible, according to a report by Leadership. The corporation also cautioned members of the public against engaging in unauthorised dealings with any of the closed banks. It warned that anyone attempting to remove, conceal, retain or interfere with the assets, documents or properties belonging to the failed institutions could face legal consequences. According to the NDIC, such actions amount to violations of the law and could hinder the liquidation process designed to safeguard the interests of depositors and creditors.
Verification process begins for depositors
The NDIC said it has already begun the verification process required for the payment of insured deposits to eligible customers. It assured depositors that further information on how to access their insured funds, submit claims and participate in the liquidation process would be communicated in due course. The agency urged affected customers to remain calm and rely only on official updates as it works to conclude the closure process in an orderly and transparent manner.
The CBN's revocation of the licences marks one of the largest closures of microfinance banks in recent years, with regulators maintaining that the action is aimed at preserving financial stability, strengthening confidence in the banking sector and protecting the interests of depositors across the country.
What this means for depositors and the naira
For affected depositors, the NDIC's swift action offers a pathway to recover insured funds, though patience will be required during the verification process. The mass closure signals tighter regulatory oversight in Nigeria's financial system, which could strengthen confidence in the banking sector over time but may also create short-term liquidity concerns for customers who relied on these microfinance banks for daily transactions.