CBN warns Nigerians against new unlicensed microfinance bank

The Central Bank of Nigeria (CBN) has raised the alarm over the activities of Zuldal Microfinance Bank Limited, declaring the firm unlicensed and operating illegally in the country.

In a statement posted on X on Thursday, the Acting Director of Corporate Communications, Hakama Sidi Ali, said Zuldal had no regulatory approval to operate as a microfinance bank, describing its activities as a clear violation of the Banks and Other Financial Institutions Act (BOFIA) 2020.

Quoting Section 2(1) of BOFIA, the bank reminded the public that “no person shall carry on any banking business in Nigeria except it is a company duly incorporated in Nigeria and holds a valid banking licence issued by the CBN.”

According to the apex bank, its attention was drawn to reports that the firm claimed to be a licensed microfinance institution with supposed branches in Lagos, Abuja, Kaduna and Kano.

The CBN, however, firmly debunked the claim.

“The said Zuldal Microfinance Bank Limited is not a licensed microfinance bank and has no authorisation from the Central Bank of Nigeria to operate or carry out any form of banking or microfinance business in Nigeria,” the statement read.

The regulator warned Nigerians to steer clear of the bank, stressing that transactions with unlicensed financial operators expose people to severe risks, including loss of funds.

“The general public is strongly advised to disregard any claims of licensing or approval by Zuldal Microfinance Bank Limited and to refrain from engaging in any financial transactions with the said entity, as such dealings are undertaken at the individual’s own risk,” the CBN added.

The apex bank also urged the public to always verify the licensing status of financial institutions before investing or carrying out any banking transactions.