The Central Bank of Nigeria (CBN) has revoked the operating licences of 46 microfinance banks across the country, citing their failure to meet regulatory requirements for continued operation.
The apex bank announced that the revocation took effect on Wednesday, July 1, 2026, describing the action as part of efforts to strengthen the Nigerian financial system, protect depositors and ensure that licensed financial institutions comply with the law.
The decision was contained in a statement issued by the Acting Director of the CBN’s Corporate Communications Department, Mrs. Hakama Sidi-Ali.
According to the statement, the licences were withdrawn under the powers granted to the Central Bank by Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.
The CBN said the revocation was approved by its Governor, Mr. Olayemi Cardoso, after the affected banks failed to satisfy the conditions required to continue operating as licensed financial institutions.
It explained that investigations and regulatory assessments showed that the affected institutions had breached key operational and financial requirements expected of microfinance banks.
The apex bank listed several reasons for the action, saying some of the institutions no longer had enough assets to meet their financial obligations to customers and other creditors.
It also said some of the banks had shut down their operations without obtaining the approval of the CBN, contrary to banking regulations.
According to the regulator, a number of the affected institutions had stopped carrying out financial intermediation, meaning they were no longer providing banking services such as accepting deposits and granting loans to individuals and small businesses.
The statement further disclosed that some of the banks failed to commence operations within 12 months after receiving their licences, while others could no longer maintain the minimum capital required to remain in business because their funds had been eroded by accumulated losses.
The CBN stressed that licensed financial institutions are expected to meet minimum prudential standards at all times in order to protect customers’ funds and maintain confidence in the banking sector.
It said the latest action was aimed at preventing weak institutions from posing risks to depositors and the wider financial system.
“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 said.
The apex bank added that it would continue to monitor financial institutions closely and take appropriate supervisory measures whenever necessary.
“The Central Bank of Nigeria remains committed to promoting a safe, sound and resilient financial system and will continue to take appropriate supervisory and regulatory actions, where necessary, to maintain public confidence in the Nigerian financial system,” it stated.
Microfinance banks play an important role in Nigeria’s financial system by providing banking services to low-income earners, small businesses, traders, artisans and people in rural communities who may not have easy access to commercial banks.
They also support financial inclusion, one of the CBN’s major policy goals aimed at ensuring more Nigerians have access to savings accounts, loans, payment services and other financial products.
However, operators in the sector are required to meet strict regulatory standards covering capital adequacy, corporate governance, liquidity, risk management and regular reporting to the CBN.
The revocation of licences is one of the strongest enforcement measures available to the CBN when a financial institution fails to meet these standards or is no longer capable of operating safely.
Over the years, the apex bank has carried out similar exercises involving microfinance banks, finance companies and other financial institutions found to have violated banking regulations or become financially distressed.
They also argue that removing non-performing institutions creates room for better-managed operators to serve customers more effectively.
Although the CBN did not immediately release the names of all the affected banks in its statement, the regulator is expected to publish the details through official channels in line with regulatory procedures.
Customers of the affected institutions are expected to await further guidance from the CBN and other relevant authorities regarding the resolution process and any arrangements concerning deposits and other financial obligations.
The latest action comes as the Central Bank continues its broader reforms aimed at strengthening Nigeria’s banking industry under the leadership of Governor Olayemi Cardoso.
Since assuming office, the CBN has repeatedly highlighted the need for stronger supervision, improved corporate governance and strict compliance with banking regulations as part of efforts to build a more stable and resilient financial system.
With the revocation of the 46 microfinance bank licences, the apex bank has signalled that it will continue to enforce regulatory standards and take firm action against institutions that fail to meet the requirements for operating within Nigeria’s financial sector.