By Milcah Tanimu

The Central Bank of Nigeria (CBN) has banned mobile money operators and fintech firms from onboarding new customers, sparking panic among some bank customers. This directive affects platforms such as OPay, Palmpay, Kuda Bank, and Moniepoint, among others, until further notice.

The move is reportedly linked to an ongoing audit of the Know-Your-Customer (KYC) process of these fintechs, amid concerns over money laundering and terrorism financing. Although the CBN has not officially commented on the directive, sources from major fintechs have confirmed the development.

The decision coincides with a court order obtained by the Economic and Financial Crimes Commission (EFCC) to freeze over 1,100 bank accounts allegedly involved in illegal foreign exchange transactions.

The President of the Bank Customers Association of Nigeria supported the CBN’s action, emphasizing the need for strict regulations to ensure the integrity of financial institutions. However, some individuals welcomed the move, citing concerns over lax KYC processes leading to scams and fraudulent activities.

Fintech companies have faced increased regulatory scrutiny in recent months, with the CBN introducing new KYC rules targeting these startups.

While the fintechs have complied with the directive, some sources have questioned why these companies are consistently targeted. They argue that fintechs have significantly contributed to financial inclusion in the country.

Meanwhile, customers have expressed worries about the safety of their funds and the overall security of their accounts on these platforms, highlighting concerns over the ongoing regulatory actions.