RECENTLY, the internet was abuzz with a claim that the Central Bank of Nigeria (CBN) has banned some financial technology companies due to their cryptocurrency involvement.
The claim, shared alongside an image of the CBN headquarters in Abuja, was posted by Tunde Ednut, a Nigerian blogger and social media influencer with over 4.1 million followers on Instagram.
The claim read:
Customers panic as CBN bans Opay, Palmpay, Kuda and others over cryptocurrency involvement.
The post has garnered over 73,000 likes and more than 4,400 comments as of May 4, 2024.
Ednut credited Punch newspaper as the source of the information.
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It will be recalled that in an effort to stop what it viewed as reported manipulation of the foreign exchange market and unlawful money transfers, the Nigerian government, acting through the Nigerian Communications Commission, blocked the websites of Binance and other cryptocurrency platforms in February 2024.
CLAIM
CBN bans Opay, Palmpay, others over cryptocurrency involvement.
THE FINDINGS
Findings by The FactCheckHub show that the claim is MISLEADING!
The Punch, Nairametrics and other credible media houses reported that the Central Bank of Nigeria had stopped four fintech companies namely, Opay, Palmpay, Kuda and Moniepoint from onboarding new customers,
The mandate was connected to an ongoing evaluation of the fintech companies’ Know-Your-Customer procedures. These companies have been under investigation in recent months due to worries about money laundering and terrorism financing.
The necessary procedure of confirming and authenticating a client’s identity upon account establishment and on a regular basis is known as “Know Your Customer” or “Know Your Client.” To put it simply, banks need to make sure that their customers are who they claimed to be.
In December 2023, the CBN implemented a mandatory stricter Know Your Customer (KYC) measures, which kicked off in April 2024 requiring all customers to provide their Bank Verification Number or a national identification number (NIN) for account or wallet opening.
The order was issued after several high-profile fraud incidents raised concerns about the existing Know Your Customer (KYC) processes.
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The media reports also highlighted that the directive coincided with the court order that the Economic and Financial Crimes Commission (EFCC) obtained to freeze at least 1,146 bank accounts owned by various individuals and companies allegedly involved in illegal foreign exchange transactions.
Further checks show that the texts (headline) on the Instagram image is different from what was reported in the media.
In conclusion, the CBN did not banned the four fintechs from operating in the country; though it directed them to stop onboarding new customers.
THE VERDICT
The claim that the CBN bans Opay, Palmpay, others over cryptocurrency involvement is MISLEADING; the CBN’s directive aims to stop the fintechs from onboarding new customers only, as it did not ban their operations in the country.
Seasoned fact-checker and researcher Fatimah Quadri has written numerous fact-checks, explainers, and media literacy pieces for The FactCheckHub in an effort to combat information disorder. She can be reached at sunmibola_q on X or [email protected].
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