Major fintech firms in Nigeria Opay, Paga, Palmpay, Kuda Bank, and Moniepoint, have resumed the onboarding of new customers as the Central Bank of Nigeria (CBN) lifts six six-week-long ban.
Opay announced the resumption of new members on its official X handle which the company wrote,
“We are thrilled to announce that the Central Bank of Nigeria, has given Opay the thumbs up to resume onboarding new users”.
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Also, Palmpay wrote on its X handle,
“We are pleased to announce that the onboarding of new customers has resumed on PalmPay for individual and business users following the review by the CBN. We are thrilled to continue our mission to provide more Nigerians with access to secure and reliable financial services.”
The resumption of onboarding of new members by these Fintech companies is coming after the CBN in April this year, ordered the restriction of new customer signups after over 1,000 accounts were blocked due to peer-to-peer (P2P) crypto trading. The CBN disclosed that a lot of crypto traders were leveraging the fintech platforms to disrupt the FX market.
Recall that the country imposed a strict restriction on crypto trading in the country which the National Security Adviser (NSA), labeled cryptocurrency as a security concern.
The NSA found a lot of accounts that were involved in crypto trading and blocked the accounts. They expressed concern that fintechs are rapid in opening accountswithout proper checks.
These fintechs have faced heavy scrutiny for inadequate KYC measures that have led to fraud. In October 2023, Fidelity Bank blocked transfers to OPay, Palmpay, Kuda, and Moniepoint over concerns that lax KYC processes led to an increase in fraud incidents. One month after that incident, the Central Bank shared new KYC rules for all financial institutions that appeared targeted at fintech startups.
On May 20, 2024, the fintechs were given several conditions for the onboarding freeze to be lifted, ordering them to block P2P crypto transfers and mandating physical address verification for all tiers of accounts. The fintechs were also asked to update their facial verification for customers.
In line with this directive, one of the affected fintech firms Opay, last month, issued a public notice to all its clients announcing the need for a mandatory physical address verification process to comply with the Central Bank of Nigeria’s (CBN) directive.
The notice, signed by the management of OPay, outlined the steps that will be taken to ensure this compliance.
Part of the notice reads,
“To comply with CBN requirements, it is necessary for all merchants with OPay Business to complete a physical address verification. So, shortly, our staff will be visiting your location to assist with this verification process. For your security, please ensure that you verify the identity of our personnel to prevent any possibility of impersonation or fraud.
“Our staff will carry proper identification (Opay ID Card, Lark Business Card, BD tool, or General Agent Platform for this purpose. Please note that our representative(s) will never ask for your password, OTP (One-Time Password), PIN, or other details related to your OPay Business account. Thank you for your cooperation and understanding as we work together to meet these requirements.”
With the lift of the ban imposed by the CBN, affected fintech are relieved by the decision which somehow posed a challenge to their growth.