NDIC Implements Deposit Disbursement for Revoked Microfinance Banks
The Nigeria Deposit Insurance Corporation (NDIC) has initiated the disbursement of insured deposits to customers of 46 microfinance banks whose operating licenses were revoked by the Central Bank of Nigeria (CBN).
In a recent statement, Hohau Gambo, the Director General of Communications and Public Relations at NDIC, confirmed that the corporation has been designated as the official liquidator for these banks following the CBN’s decision to revoke their licenses, effective July 1.
This appointment aligns with the mandates outlined in both the Banks and Other Financial Institutions Act 2020 (BOFIA) and the NDIC Act 2023. The NDIC emphasised that the affected banks can no longer function as licensed financial entities and are prohibited from conducting banking operations in Nigeria.
The corporation has commenced an orderly closure process for the failed banks, which includes the acquisition, verification, and disbursement of insured amounts to eligible depositors. The NDIC assures that depositors and the general public will be updated on subsequent steps in the liquidation process.
Public Advisory and Legal Compliance
In its communication, the NDIC cautioned the public against engaging in transactions with the banks that have lost their licenses. Furthermore, it warned individuals not to destroy, hide, or alter the assets and records of these institutions, as such actions would breach legal obligations and could incur penalties.
Background on Licensing Revocation
PREMIUM TIMES previously reported that the CBN revoked the operating licenses of these 46 microfinance banks after it was determined they failed to meet essential regulatory standards. According to the CBN, these banks faced sanctions for various infractions, including insufficient assets to meet debt obligations, unauthorized operations, prolonged activity suspensions, delays in commencing operations, and failure to maintain the legally required minimum capital.
This decisive action is part of the CBN’s strategy to enhance stability within the financial sector, safeguard depositors, and ensure full compliance with banking regulations. The banks impacted by the revocation are dispersed across a number of states, including Lagos, Kano, Abia, and others, significantly impacting the microfinance landscape in Nigeria.
List of Affected Institutions
The list of banks whose licenses were revoked includes notable names such as Gold Microfinance Bank, Bompai Microfinance Bank, and Kanopoly Microfinance Bank, among others. In total, this action affects a wide range of institutions across the nation.
To facilitate the prompt payment of insured deposits and other claims tied to the liquidation process, the NDIC has urged depositors from the affected banks to actively participate in the verification process.
