CBN office

The Central Bank of Nigeria (CBN) has warned that it will penalise microfinance banks (MFBs) that are operating unapproved branches or cash centres.

The apex bank stated this in a circular addressed to all MFBs, a copy of which was posted on its website.

The CBN said: “It is pertinent to remind you (that the penalty for operating a branch/cash centre without prior approval of the CBN as stipulated in Section 13.1(b) of the Revised Guidelines for MFBs is N250,000 per branch; for a Unit MFB, N500,000 per branch for a State MFB; and N1 million per branch for a National MFB.”

In addition, the regulator insisted that such unapproved branched/cash centres would be shut within 30 days.

“Failure to close an unapproved branch or cash centre, shall attract a fine of N5,000 for each day of default, irrespective of the category of MFB. Moreover, failure to comply with any directive issued by the CBN, as stipulated in Section 19(i) of the Revised Guidelines for MFBs, is a ground for revocation of license,” it stated.