The revocation of the operating licenses of 13 microfinance banks in Kano has raised concerns among customers and small business owners, with an economist warning that such action by the Central Bank of Nigeria (CBN) usually points to significant financial or governance problems.

The Central Bank of Nigeria (CBN) has revoked the operating licenses of 46 microfinance banks across Nigeria over their failure to meet regulatory requirements for continued operation.

In a statement issued on Wednesday, the apex bank said the revocation took effect from July 1, 2026, in accordance with Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.

The CBN said the action was approved by its Governor, Olayemi Cardoso, following the affected banks’ failure to meet the regulatory standards required of licensed financial institutions.

According to the statement, the affected institutions were found to have one or more deficiencies, including insufficient assets to meet liabilities, closure of operations without the CBN’s approval, prolonged inactivity and cessation of financial intermediation, failure to commence operations within 12 months of license approval, and failure to maintain the minimum capital requirement due to accumulated losses.

But speaking to DAILY POST, Dr. Abdulnasir Turawa Yola, an economist and lecturer in the Department of Economics and Development Studies at the Federal University Dutse, said the CBN does not revoke a bank’s license without identifying serious regulatory concerns.

“Whenever a bank’s license is revoked, it means the CBN has detected a problem. It could be that the institution no longer meets the required capital base, or it may be facing serious management and corporate governance challenges,” he said.

Dr. Yola warned that the collapse of a financial institution could expose depositors and investors to significant losses despite the intervention of the Nigeria Deposit Insurance Corporation (NDIC).

“When a bank’s license is withdrawn, there are consequences. Although the NDIC compensates depositors, it is not always 100 per cent of their funds. Creditors are usually settled first, followed by depositors, while shareholders are often the last to be considered. It’s always a risky situation when a bank fails with customers’ money still inside,” he said.

The 13 affected microfinance banks in Kano are Zain MFB (formerly Dawakin Tofa MFB), Bompai MFB, Ajwa MFB (formerly Gezawa MFB), NOW Digital MFB, Minjibir MFB, Shanono MFB, Sumaila MFB, Rimin Gado MFB, Sycamore MFB, Tofa MFB, Kanopoly MFB, Bellbank MFB (formerly Tsanyawa MFB), and Esteem MFB.

While some residents believe the closures will have minimal impact because the banks served relatively small customer bases, others, particularly small-scale entrepreneurs, fear the move could limit access to affordable credit.

Ibrahim Sulaiman, who sells ice in Nasarawa Local Government Area, told DAILY POST that microfinance banks have been a lifeline for many small businesses.

“These banks often give us loans without much difficulty. Commercial banks have stricter conditions, making it hard for people like us to qualify, they also prefer to issue large loans running into millions of naira, whereas we usually need smaller amounts such as ₦50,000 or ₦100,000,” he said.

Efforts to obtain comments from officials of one of the affected microfinance banks were unsuccessful as of the time of filing this report.
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The revocation of the operating licenses of 13 microfinance banks in Kano has raised concerns among customers and small business owners, with an economist warning that such action by the Central Bank of Nigeria (CBN) usually points to significant financial or governance problems.

The Central Bank of Nigeria (CBN) has revoked the operating licenses of 46 microfinance banks across Nigeria over their failure to meet regulatory requirements for continued operation.

In a statement issued on Wednesday, the apex bank said the revocation took effect from July 1, 2026, in accordance with Sections 12 and 13 of the Banks and Other Financial Institutions Act (BOFIA), 2020.

The CBN said the action was approved by its Governor, Olayemi Cardoso, following the affected banks’ failure to meet the regulatory standards required of licensed financial institutions.

According to the statement, the affected institutions were found to have one or more deficiencies, including insufficient assets to meet liabilities, closure of operations without the CBN’s approval, prolonged inactivity and cessation of financial intermediation, failure to commence operations within 12 months of license approval, and failure to maintain the minimum capital requirement due to accumulated losses.

But speaking to DAILY POST, Dr. Abdulnasir Turawa Yola, an economist and lecturer in the Department of Economics and Development Studies at the Federal University Dutse, said the CBN does not revoke a bank’s license without identifying serious regulatory concerns.

“Whenever a bank’s license is revoked, it means the CBN has detected a problem. It could be that the institution no longer meets the required capital base, or it may be facing serious management and corporate governance challenges,” he said.

Dr. Yola warned that the collapse of a financial institution could expose depositors and investors to significant losses despite the intervention of the Nigeria Deposit Insurance Corporation (NDIC).

“When a bank’s license is withdrawn, there are consequences. Although the NDIC compensates depositors, it is not always 100 per cent of their funds. Creditors are usually settled first, followed by depositors, while shareholders are often the last to be considered. It’s always a risky situation when a bank fails with customers’ money still inside,” he said.

The 13 affected microfinance banks in Kano are Zain MFB (formerly Dawakin Tofa MFB), Bompai MFB, Ajwa MFB (formerly Gezawa MFB), NOW Digital MFB, Minjibir MFB, Shanono MFB, Sumaila MFB, Rimin Gado MFB, Sycamore MFB, Tofa MFB, Kanopoly MFB, Bellbank MFB (formerly Tsanyawa MFB), and Esteem MFB.

While some residents believe the closures will have minimal impact because the banks served relatively small customer bases, others, particularly small-scale entrepreneurs, fear the move could limit access to affordable credit.

Ibrahim Sulaiman, who sells ice in Nasarawa Local Government Area, told DAILY POST that microfinance banks have been a lifeline for many small businesses.

“These banks often give us loans without much difficulty. Commercial banks have stricter conditions, making it hard for people like us to qualify, they also prefer to issue large loans running into millions of naira, whereas we usually need smaller amounts such as ₦50,000 or ₦100,000,” he said.

Efforts to obtain comments from officials of one of the affected microfinance banks were unsuccessful as of the time of filing this report.
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