CBN hammers Opay, Palmpay, Kuda, Moniepoint for alleged illegal FX transactions

Four Financial Technology Companies (Fintechs) have come under the hammer of the Central Bank of Nigeria (CBN) over allegation of their accounts being used for illicit foreign exchange transactions

Consequently, the affected Fintechs—OPay, Palmpay, Kuda Bank, and Moniepoint—have been barred from onboarding new customers.

“Hello! We’ve temporarily paused new sign-ups on our platform. This means that you’ll be unable to open a new account at the moment. We apologise for any inconvenience this may cause” one of the Fintechs wrote on its website.

Two of the companies’ representatives reportedly admitted that the CBN’s direction is connected with these allegations.

They did, however, highlight the fact that most of the affected accounts are held by commercial banks rather than fintech platforms, raising fears that the mandate might be misdirected.

READ ALSO:CBN clears valid FX transactions backlog

“I can confirm that 90% of the accounts implicated in the illicit forex transactions are with commercial banks, and only 10% are with fintechs. Why then has the CBN not extended this directive to the commercial banks? We face a widespread issue here, and targeting fintechs seems like an unfair focus on the more vulnerable targets,” one of the sources explained.

It would be recalled earlier that the Economic and Financial Crimes Commission (EFCC) recently secured a court order to freeze at least 1,146 bank accounts owned by various individuals and companies allegedly involved in illegal foreign exchange transactions.

Justice Emeka Nwite, in a decision on the ex-parte motion presented by the anti-graft agency’s lawyer, Ekele Iheanacho, also approved the commission’s request to complete the investigation within 90 days.

Though the verdict was issued on April 24, its certified true copy was granted on Monday. The other offenses under investigation by the EFCC involve money laundering and terrorism financing.

A look at the list of the affected accounts shows that indeed most of the bank accounts involved are mostly deposit money bank accounts.

By: Babajide Okeowo

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