The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks, intensifying its efforts to strengthen regulatory compliance and improve the resilience of the country’s financial system.
The revocation, which takes effect from July 1, 2026, was approved by the Governor of the CBN, Olayemi Cardoso, and executed under Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.
In a statement issued on Wednesday, the CBN’s Acting Director of Corporate Communications, Hakama Sidi Ali, said the affected institutions failed to meet the regulatory requirements necessary to continue operating as licensed financial institutions.
According to the apex bank, the decision followed extensive supervisory assessments, which found that the affected microfinance banks had committed one or more regulatory breaches. These included maintaining insufficient assets to meet liabilities, suspending operations without the CBN’s approval, ceasing financial intermediation, failing to commence business within 12 months of receiving their licences, and falling below the minimum capital requirements prescribed for licensed institutions.
The action represents one of the most significant regulatory interventions in the microfinance subsector in recent years and reflects the CBN’s determination to remove weak and non-compliant institutions from the financial system.
Microfinance banks play a critical role in extending financial services to low-income households, small businesses and underserved communities. However, industry operators have faced mounting challenges in recent years, including inflationary pressures, rising operating costs, weak corporate governance and heightened capital requirements, factors that have increased pressure on smaller institutions.
The CBN said the latest licence revocations form part of its broader strategy to preserve financial system stability, strengthen regulatory discipline and protect depositors. By removing institutions that no longer meet prudential standards, the regulator aims to reinforce public confidence in Nigeria’s financial sector while ensuring that only sound and adequately capitalised institutions remain in operation.
The apex bank reaffirmed its commitment to maintaining a safe, sound and resilient financial system through sustained supervision and timely regulatory intervention. It added that it would continue to take appropriate enforcement actions against institutions that fail to comply with applicable laws and prudential guidelines.
The latest action signals that the Cardoso-led CBN is maintaining its stricter supervisory stance as it seeks to improve governance, enhance financial stability and restore confidence across Nigeria’s banking industry.