The Central Bank of Nigeria (CBN) has recently granted licenses to ten (10) digital banks offering services in the country.
While these digital banks could be lumped as FinTech due to the similarities in their service offerings, they operate under different license categories issued by the Central Bank of Nigeria (CBN). With payment at the core of these Digital banks, many of them would like to do more, hence, to pursue this aspiration, several of them have acquired microfinance banking (MFB) licenses.
Unlike the regular commercial bank license, the MFB licenses are a low-cost quick fix for digital banks. It allows them to accept deposits and provide lending services, the most basic banking services.
Investors King understands that a microfinance bank (MFB) license is the most commonly used license for the purpose of digital banking in Nigeria. The MFB license enables the holder to receive deposits and grant loans to its customers.
For many Digital banks, an MFB license is important, which has seen a large number of them acquire MFB licenses over the last few years. The MFB license also serves as a quick fix for Digital banks looking to offer some banking services but are unable to raise the ₦25 billion ($59.5 million) required to secure a commercial bank license.
It is however pertinent for individuals to know the status of most digital banks as regards their license before trusting them with their funds. This step shouldn’t be overlooked due to the fact that a lot of digital banks operating in the country today are illegal which can spell doom for customers in the long run.
Check Out The List of Ten (10) Digital Banks Granted Microfinance Bank Licenses by the CBN
1.) Piggyvest
Launched in 2016 just as a savings product, Piggyvest which is a CBN-Licensed microfinance bank has morphed into more than just a savings platform and is growing into a robust financial management platform with many products planned for the next few years. Piggyvest operated in partnership with 2 Microfinance banks and used their licenses. However, in early 2018, the startup acquired Gold Microfinance bank and its license.
2.) Moniepoint
CBN-Licensed microfinance bank Moniepoint is one of Nigeria’s leading financial solutions providers, formerly known as TeamApt. Moniepoint is a community-based bank with its services powered by Moniepoint MFB Limited, a Microfinance bank duly licensed by the Central Bank of Nigeria (CBN). In 2022, Moniepoint MFB was also awarded by the CBN as the most inclusive payment platform in the country.
3.) VFD Microfinance
VFD Microfinance bank is one of the leading microfinance banks in Nigeria which is based in Lagos. The company is run by a highly experienced management board, with more than five decades of excellent customer service under their belt. The VFD Group Plc has stated that it will intensify its quest to obtain a commercial banking license from the Central Bank of Nigeria (CBN) before the end of 2023.
4.) Sofri
Launched in April 2022, Sofri is a trademark of Links Microfinance Limited (Links Mfb). Links Mfb is licensed and regulated by the Central Bank of Nigeria (CBN) and deposits are insured by the Nigeria Deposit Insurance Corporation (NDIC). The startup uses technology to deliver superior customer service to its customers.
5.) FairMoney
FairMoney MFB, a digital microfinance bank that is licensed by the Central Bank of Nigeria (CBN) provides financial services via its flagship mobile app. With Fairmoney, users can get a loan instantly in 5 minutes, from anywhere in Nigeria. They can repay on or before your due date with no hidden charges.
6.) Mint
Mint Digital Bank is a CBN-Licensed microfinance bank and a subsidiary of Finex Microfinance Bank that offers unparalleled value to Nigerians by providing innovative solutions to businesses and individuals who require digital financial services. The bank also provides financial services to underserved groups such as low-income earners.
7.) Carbon
Carbon is a Microfinance Bank licensed by the Central Bank of Nigeria (CBN) with deposits insured by the Nigerian Deposit Insurance Corporation (NDIC). Carbon offers Nigerians better financial services through free transfers, high-yield savings, and buy now pay later at zero account fees and an annual interest of 1% per annum.
8.) Kuda
Kuda is a full-service digital microfinance bank that is duly licensed by the Central Bank of Nigeria. Kuda offers users more than one way to pay easily, including a widely accepted debit card issued in partnership with Visa, quick web payments direct from their Kuda account, and location-based gift cards for shopping and subscriptions. From international transfers to on-the-spot payments at market stalls, the startup has simplified sending money.
9.) Sparkle
Sparkle Microfinance Bank is licensed by the Central Bank of Nigeria (CBN). All deposits are insured by the Nigerian Deposit Insurance Corporation (NDIC). Sparkle is a lifestyle and financial ecosystem providing seamless solutions to Nigeria’s retailers, SMEs, and individuals. The startup mission is to help Nigerians fulfill their potential by democratizing access to valuable solutions for their business and personal needs.
10.) Eyowo
Eyowo Microfinance Bank Ltd (RC838171) is licensed by the Central Bank of Nigeria as a Microfinance Bank. Eyowo unifies all the financial tools users need to pay, receive, budget, and save money in one place, also providing you with the safest card in Nigeria in partnership with Mastercard.
