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    Flutterwave adds Google Pay to its Payment Options for African Businesses

    Flutterwave adds Google Pay to its Payment Options for African Businesses

    After Receiving Switching and Processing Licence from CBN, Flutterwave includes eNaira to its Payment Options

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    Flutterwave gets Switching and Processing licence from CBN

    Flutterwave gets Switching and Processing licence from CBN

    Google Expands its Digital Wallet to South Africa

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    FCCPC Orders Drawdown of Online Credit Companies

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  • START UPS
    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

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    ThriveAgric selected West African Winners of the AYuTe Africa Challenge, receiving $1 million.

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    Yebo Fresh raises $4.5 million to Supply Fresh Food in South Africa

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  • NEWS
    Flutterwave debunks Alleged Reports of Hacked Accounts

    Flutterwave debunks Alleged Reports of Hacked Accounts

    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

    Jumba raises $4.5 Million Pre-seed to Expand the supply of Construction materials in Kenya.

    Jumba raises $4.5 Million Pre-seed to Expand the supply of Construction materials in Kenya.

    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

    PICTDA announces Resumption Date for Code Plateau Cohort

    PICTDA announces Resumption Date for Code Plateau Cohort

    Releaf secures $3.3 million Pre-series A funding to improve its Food Processing Technology

    Releaf secures $3.3 million Pre-series A funding to improve its Food Processing Technology

  • FEATURED
    Nigeria’s Cash Swap Policy: Goals versus Results

    Nigeria’s Cash Swap Policy: Goals versus Results

    Six Things that could Shape the Northern Nigerian Tech Ecosystem in 2023

    Six Things that could Shape the Northern Nigerian Tech Ecosystem in 2023

    5 Exciting Things That Happened in the Nigerian Tech Ecosystem

    5 Exciting Things That Happened in the Nigerian Tech Ecosystem

    SmallSmall to Expand to Jos following a $3 Million Seed Raise

    SmallSmall to Expand to Jos following a $3 Million Seed Raise

    The Increase in Data Prices is a Big Challenge for Remote Workers in Nigeria

    How Tobiloba Olusola is making Electronic Health Records Accessible to Patients

    How Tobiloba Olusola is making Electronic Health Records Accessible to Patients

  • BLOCKCHAIN
    Binance now accepts Naira Deposits and Withdrawals

    Binance now accepts Naira Deposits and Withdrawals

    Cardano Accelerator Adaverse Invests in Afriguild’s Mission to Onboard Africans Into Web3

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    Is Africa Ready to Operate a Digital Monetary Policy?

    Is Africa Ready to Operate a Digital Monetary Policy?

    What Binance and TikTok Star, Khaby Lame’s Partnership mean for Crypto and Web3 Adoption

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    PLA2SMART Set to Lead a New Frontier in Nigeria’s Tourism Economy

    Bundle Launches Web App to Give Users More Accessibility to Crypto

    Bundle Launches Web App to Give Users More Accessibility to Crypto

  • FINANCE
    CBN prohibits Foreign Banks from Offering Banking Services

    CBN prohibits Foreign Banks from Offering Banking Services

    Flutterwave adds Google Pay to its Payment Options for African Businesses

    Flutterwave adds Google Pay to its Payment Options for African Businesses

    After Receiving Switching and Processing Licence from CBN, Flutterwave includes eNaira to its Payment Options

    After Receiving Switching and Processing Licence from CBN, Flutterwave includes eNaira to its Payment Options

    Flutterwave gets Switching and Processing licence from CBN

    Flutterwave gets Switching and Processing licence from CBN

    Google Expands its Digital Wallet to South Africa

    Google Expands its Digital Wallet to South Africa

    FCCPC Orders Drawdown of Online Credit Companies

    FCCPC Orders Drawdown of Online Credit Companies

  • START UPS
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    WorkPay raises $2.7million Pre-series A Funding to Expand its Services across Africa

    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

    Naked secures $17 Million Series B to Expand its Digital Insurance Company in Africa

    PressOne Africa raises $600,000 Pre-seed Funding to Support Entrepreneurs

    PressOne Africa raises $600,000 Pre-seed Funding to Support Entrepreneurs

    ThriveAgric selected West African Winners of the AYuTe Africa Challenge, receiving $1 million.

    ThriveAgric selected West African Winners of the AYuTe Africa Challenge, receiving $1 million.

    Yebo Fresh raises $4.5 million to Supply Fresh Food in South Africa

    Yebo Fresh raises $4.5 million to Supply Fresh Food in South Africa

    Sky.Garden survives Shutdown, gets New Owners

    Sky.Garden survives Shutdown, gets New Owners

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Kenya Orders Banks to Halt Dealings with Flutterwave and Chipper Cash

by Ajifa Solomon
July 29, 2022
in Business
Reading Time: 5 mins read
0
Kenya Orders Banks to Halt Dealings with Flutterwave and Chipper Cash

central bank of kenya

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The news:

Yesterday (July 28), Patrick Njoroge, the Governor of the Central Bank of Kenya (CBK) said Flutterwave Inc and Chipper Cash were not licensed as payments processors. It has today issued a statement to financial institutions to cease all operations with the aforementioned companies. 

Njoroge at a Monetary Policy Committee said that “Flutterwave is not licensed to operate as a remittance provider or for that matter as a PSB service provider in Kenya”. He added, “They are not licensed to operate and therefore they shouldn’t be operating. We can also say the same for Chipper Cash. ”

The Central Bank of Kenya has now issued a 7-day ultimatum to all banks and financial institutions to stop all transactions with the companies.

According to the National Payments System Act, a set of rules and instruments  that guide the transfer of funds, any person who neglects, refuses or fails to comply with the issued directive commits an offence and shall be liable on conviction to a fine not exceeding $4,203 or to imprisonment for a term not exceeding three years, or both.

The Controversy:

Flutterwave has however sent out a statement,  affirming that it had “submitted its application for a Payment Service Provider licence” in 2019 and has also “been in constant engagement with the Central Bank of Kenya to ensure that we provide all the requirements and we look forward to receiving our licence.”

Chipper Cash’s Country Director in Kenya, Leon Kiptum had earlier in January told Hapakenya that Chipper Cash was in the process of securing the International Money Transfer Operator (IMTO) Licence and was waiting “to be issued with because we have met all the requirements.”

Was there ever an authorisation? 

The National Payments System Act (PDF) on the Authorisation of service providers. 12. (1) states:

  •  No person shall in Kenya conduct the business of a payment service provider except an authorized payment service provider. 
  •  (2) A person who contravenes the provisions of subsection (1) commits an offence and shall, on conviction be liable to a fine not exceeding $4,203 or to imprisonment for a term not exceeding three years, or to both.  

Flutterwave and Chipper have however processed payments for over 7 years before they were declared unlicensed. Note that CBK did not mention a revocation of licence, rather, it points to a lack of authorisation. The questions therefore keep growing:

  • Was this merely an oversight by Kenya’s apex bank?
  • Were there no regulations while they were in operation?
  • Will the fintech companies be penalised for operating without a licence?

Getting licensed:

CBK makes provisions for the licence procedure which a legal company may seek authorisation properly.

  • A person proposing to transact the business of a payment service provider shall, before commencing such business, apply to the Bank for authorization. 
  • After a prescription form is filled for a fee, the CBK shall now decide whether the entity seeking authorisation meets its requirements.

Nothing here suggests that it could take years to get the licence. However, an infographic by Osaretin Victor Asemota, co-founder of SwiftaCorp, reveals that payments processors in Kenya have operated for over a decade before the CBK issued a licence.

       Infographic showing launch date of six companies and the year of getting licensed.

Related

Tags: CBKChipper CashFlutterwave
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