| NDIC begins takeover, verification, payment of insured sums to depositors
The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks (MFBs), reducing the number of licensed MFBs in the country from 831 to 785.
Following the revocation, the Nigeria Deposit Insurance Corporation (NDIC) has cautioned customers and the general public against engaging in unauthorised transactions with the affected banks.
The revocation took effect on Wednesday, July 1, 2026, after receiving the approval of the CBN Governor, Olayemi Cardoso, in line with the implementation of the new guidelines on distressed banks.
In a statement signed by the Acting Director of the Corporate Communications Department, Hakama Sidi Ali, the apex bank said the action was taken pursuant to Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.
According to the revocation order, the decision became necessary because one or more of the affected institutions had insufficient assets to meet liabilities, suspended operations without the CBN’s approval, or become inactive and ceased financial intermediation.
Other reasons cited included failure to commence operations within 12 months of receiving a licence and failure to maintain the minimum capital requirement unimpaired by losses.
The CBN stated that 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.”
It reiterated its commitment to promoting a safe, sound and resilient financial system, adding that it would continue to take appropriate supervisory and regulatory actions, where necessary, to maintain public confidence in Nigeria’s financial system.
Meanwhile, the NDIC said that, pursuant to Section 12(2) of BOFIA 2020 and Section 55(1) and (2) of the NDIC Act 2023, it had been appointed the official liquidator of the 46 MFBs following the revocation of their licences.
The corporation noted that the affected institutions were no longer authorised to conduct banking business in Nigeria.
The NDIC consequently warned that “members of the public are strongly advised against any unauthorised 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.”
“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. Depositors and the general public would be duly informed on an ongoing basis of further steps to be taken regarding the liquidation exercise,” it added.
Wednesday’s revocation of 46 microfinance banks is the latest in a series of regulatory actions by the CBN aimed at strengthening supervision of the sector.
On 22–23 May 2023, the apex bank revoked the licences of 179 microfinance banks, three finance companies and four primary mortgage banks after finding that they had remained inactive, become insolvent, persistently failed to submit regulatory returns, closed operations or ceased carrying on the businesses for which their licences were issued for at least six months.
Earlier in May 2023, separate notices listed 132 and 139 microfinance banks whose licences were revoked for similar regulatory breaches, including failure to commence operations within the stipulated period, failure to maintain minimum capital unimpaired by losses, and non-compliance with CBN directives.
The licence revocations form part of a broader regulatory exercise dating back to the 2010 Target Examination of more than 800 microfinance banks, which sought to identify and address terminally distressed and technically insolvent institutions.
The CBN has consistently cited the Banks and Other Financial Institutions Act (BOFIA), 2020, as the legal basis for the revocations, describing the actions as necessary to safeguard financial stability, protect depositors and ensure that licensed institutions comply with prevailing laws and regulatory requirements.
The Affected Microfinance Banks Are:
- Minji-Se Churchill MFB (tier 1) in Rivers
- Merchant MFB (tier 2) in Abia
- Janmaa MFB (tier 1) in Kwara
- Busu MFB (tier 2) in Niger
- Gold MFB (tier 1) in Lagos
- Zain MFB, formerly Dawakin Tofa MFB, a tier 2 lender in Kano
- Bompai MFB (tier 1) in Kano
- Ajwa MFB (tier 2) in Kano
- Now Now Digital MFB (tier 2) in Kano
- Crystabel Microfinance Bank (tier 1) in Bayelsa
- Chanelle MFB (state-based) in Lagos
- Abia SME MFB (tier 1) in Abia
- Kamba MFB (tier 2) in Kebbi
- Iwade MFB (tier 2) in Ogun
- Winview MFB (tier 1) in Abuja
- Zuru MFB (tier 2) in Kebbi
- Minjibir MFB (tier 1) in Kano
- Shanono MFB (tier 2) in Kano
- Sumaila MFB (tier 2) in Kano
- Rimin Gado MFB (tier 2) in Kano
- Mwaghavul MFB (state-based) in Plateau
- Sycamore MFB (tier 2) Kano
- TOFA MFB (tier 2) in Kano
- Safegate MFB (tier 1) in Lagos
- Creekline MFB (tier 2) in Delta
- Bestar MFB (tier 1) in Oyo
- Livingspring MFB (tier 1) in Cross River
- Apple MFB (tier 2) in Ogun
- Stanford MFB (state-based) in Uyo
- Frontline MFB (tier 2) in Anambra
- Zafec MFB (tier 2) in Kaduna
- Supreme MFB (tier 1) in Lagos
- Bejin-Doko MFB (tier 2) in Niger
- Kanopoly MFB (tier 1) in Kano
- Bellbank MFB, formerly Tsanyawa (Tier 2), in Kano
- Yeneng MFB (tier 2) in Plateau
- Creditville MFB (tier 1) in Lagos
- MBAG MFB (tier 1) in Lagos
- Straight Sahara MFB (tier 1) in Benue
- Our Pass MFB (tier 2) in Ondo
- VERDANT MFB (tier 1) in Lagos
- Basawa MFB (tier 2) in Kaduna
- Casha MFB (tier 2) in Abuja
- Esteem MFB (tier 2) in Kano
- Enterpreneur MFB (tier 1) in Lagos
- Avantus MFB (tier 2) in Osun
Points At Issue
1. Licence revocations: 46 MFBs shut down
The Central Bank of Nigeria (CBN) revoked licences of 46 microfinance banks effective 1 July 2026, cutting the sector from 831 to 785 after approval by CBN Governor Olayemi Cardoso
2. Legal authority: BOFIA powers and NDIC appointment
Revocations were done under Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020. The Nigeria Deposit Insurance Corporation (NDIC) is the official liquidator under BOFIA and the NDIC Act.
3. Ground for action: Insolvency, inactivity and capital breaches
Reasons cited include insufficient assets to meet liabilities, unapproved closures, inactivity/cessation of intermediation, failure to begin operations within 12 months, and impaired minimum capital.
4. What customers must do:
Customers of the shut banks have been warned to avoid further dealings with them as the closed MFBs can no longer conduct banking. NDIC warned against unauthorised transactions or interference with assets and has begun takeover, verification and payment of insured sums to eligible depositors.
5. Policy context: Continued sector clean‑up to protect depositors
The move continues CBN’s multi‑year tightening of MFB supervision—including major licence cancellations in 2023—intended to remove distressed, non‑compliant institutions and safeguard financial stability.