Kenyan Central Bank Orders Financial Institutions to Stop Dealing With Two Nigerian Fintechs


Kenyan Central Bank Orders Financial Institutions To Stop Dealing With Two Nigerian Fintechs

In a letter addressed to the CEOs of economic establishments, the Central Financial institution of Kenya (CBK) has stated monetary establishments working within the nation should stop and desist from coping with two fintechs, Flutterwave and Chipper Money. The letter reiterates the CBK governor Patrick Njoroge and the Asset Restoration Company (ARA)’s assertions that the 2 firms aren’t licensed to function in Kenya.

Kenyan Central Bank Orders Financial Institutions To Stop Dealing With Two Nigerian Fintechs

Flutterwave and Chipper’s Conflict With the CBK

The Central Financial institution of Kenya (CBK) has ordered monetary establishments within the nation to stop and desist from coping with two fintech startups Flutterwave and Chipper Money. The order got here barely 24 hours after the CBK governor, Patrick Njoroge, had instructed journalists that the 2 entities aren’t licensed to function in Kenya.

Kenyan Central Bank Orders Financial Institutions To Stop Dealing With Two Nigerian Fintechs

Kenyan Central Bank Orders Financial Institutions To Stop Dealing With Two Nigerian Fintechs

Earlier than the announcement by the CBK, a Excessive Courtroom in Kenya had dominated that Flutterwave’s financial institution accounts be frozen to make means for a probe into the fintech big’s alleged unlawful actions. The courtroom ruling subsequently enabled Kenya’s Asset Restoration Company (ARA) to dam Flutterwave’s entry to greater than 50 financial institution accounts which reportedly maintain almost $60 million.

Kenyan Central Bank Orders Financial Institutions To Stop Dealing With Two Nigerian Fintechs

As beforehand reported by .com Information, the ARA has argued that Flutterwave just isn’t offering service provider companies as per claims however is as a substitute concerned in cash laundering actions. Nonetheless, Flutterwave dismissed the allegations and claimed to “have the information to confirm this.” The fintech unicorn, which raised $250 million earlier this yr, additionally claimed it “maintains the best regulatory requirements in our operations.”

Kenyan Central Bank Orders Financial Institutions To Stop Dealing With Two Nigerian Fintechs

As well as, the fintech agency’s assertion claimed its “anti-money laundering practices and operations are often audited by one of many Huge 4 companies.”

Kenyan Central Bank Orders Financial Institutions To Stop Dealing With Two Nigerian Fintechs

CEOs of Monetary Establishments Instructed to Verify Their Compliance

Whereas Flutterwave recommended in its assertion that’s working with the regulators, Njoroge’s remarks and the CBK’s subsequent letter to CEOs of Kenyan monetary establishments dated July 29, reiterate ARA’s allegations that Flutterwave is engaged in “cash remittance and cost companies with out licensing and authorization.”

In the meantime, along with informing the heads of the Kenyan monetary establishments in regards to the two fintechs’ working license standing, the letter additionally calls for the CEOs to verify their compliance with the order inside seven days.

“You might be due to this fact directed to instantly stop and desist from coping with Flutterwave and Chipper. You might be thereafter required, inside seven days of the date of the letter to verify to CBK your compliance with the directive,” the CBK’s letter reads.

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Terence Zimwara

Terence Zimwara is a Zimbabwe award-winning journalist, creator and author. He has written extensively in regards to the financial troubles of some African nations in addition to how digital currencies can present Africans with an escape route.

Picture Credit: Shutterstock, Pixabay, Wiki Commons

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