CBN revokes licences of 46 microfinance banks, NDIC takes over as liquidator

The Central Bank of Nigeria has revoked the operating licences of 46 microfinance banks effective 1 July 2026, triggering an immediate takeover by the Nigeria Deposit Insurance Corporation. The NDIC has been appointed as the Liquidator under Section 12 (2) of the Banks and Other Financial Institutions Act 2020 and Section 55 (1 & 2) of the NDIC Act 2023.

NDIC steps in, warns against asset tampering

In a swift response, the Head of the Communication & Public Affairs Department at the NDIC, Hawwau Gambo, issued a strict public directive. “Members of the public are strongly advised against any unauthorized transaction with the closed banks, or any attempt by individuals to remove, conceal, retain, or interfere with the assets, records, or properties of the banks, as this may constitute a violation of the law that could attract appropriate legal consequences,” Gambo stated.

The Corporation added that it has mobilised resources for a swift intervention. “The NDIC has commenced the process of the orderly closure of the failed banks with their immediate takeover, verification and payment of insured sums to eligible depositors,” the statement read. The NDIC will use the banks’ existing branches to verify depositors and disburse newly reviewed upward insurance caps.

Experts warn of credit vacuum and financial inclusion setback

The President of the Bank Customers Association of Nigeria, Professor Uju Ogubunka, warned that the sudden closure of 46 financial brands disrupts local credit systems. “The economy, of course, would also have to suffer for it because the roles they have been playing within the economy, they will no longer play those roles,” he said in an exclusive interview with The PUNCH. “If we don’t have other banks and financial institutions to absorb those roles, then that means there will be a vacuum, or at least there will be limitation in those services.”

Ogubunka pointed out that the clampdown threatens years of grassroots financial sensitisation, hitting market women, smallholder farmers, and small business owners the hardest. “We have been talking about financial inclusion, and that has put some degree of a minus aspiration of the country to have an improved level of financial inclusiveness,” he added.

Despite the anxieties, Ogubunka acknowledged the necessity of the move. “The best thing that has happened is that, well, CBN has taken the bull by the horn to say, ‘Okay, you can no longer function because of X, Y, Z. So please, do not enter that business anymore.’ We are protecting the country with this regressive policy, and the thing is that it’s super good.”

CBN cites persistent regulatory failures

The CBN revoked the licences over the banks’ persistent failure to meet regulatory requirements and standard financial indicators. The apex bank stated that the revocation, approved by CBN Governor Mr Olayemi Cardoso, was exercised under Sections 12 and 13 of the Banks and Other Financial Institutions Act 2020.

In a statement signed by the Acting Director of Corporate Communications, Hakama Sidi-Ali, the CBN explained that the affected institutions failed to remedy various operational deficiencies. These included holding insufficient assets to meet liabilities, unauthorised closure of business premises, prolonged inactivity, complete cessation of financial intermediation, failure to commence operations within 12 months of licence issuance, and falling short of statutory minimum capital requirements.

“The revocation of the licences is part of the Bank’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 statement read. The CBN reaffirmed its commitment to maintaining a safe, sound, and resilient financial system.

Affected institutions span multiple states

The 46 affected institutions include Minji-Se Churchill Microfinance Bank, Merchant Microfinance Bank, Janmaa Microfinance Bank, Busu Microfinance Bank, Gold Microfinance Bank, Zain Microfinance Bank, Bompai Microfinance Bank, Ajwa Microfinance Bank, NOW NOW Digital Microfinance Bank, Crystabel Microfinance Bank, Chanelle Microfinance Bank, and Abia SME Microfinance Bank. Others are Kamba Microfinance Bank, Iwade Microfinance Bank, Winview Microfinance Bank, Zuru Microfinance Bank, Minjibir Microfinance Bank, Shanono Microfinance Bank, Sumaila Microfinance Bank, Rimin Gado Microfinance Bank, Mwaghavul Microfinance Bank, Sycamore Microfinance Bank, and Tofa Microfinance Bank.

The NDIC has committed to keeping the general public and eligible depositors updated on subsequent steps in the liquidation exercise.

For Nigerian consumers and small businesses, the mass closure means reduced access to microcredit and banking services in many communities. Depositors are advised to wait for NDIC verification at the banks’ former branches to claim insured sums.