REGULATION | Central Bank of Nigeria Lifts 2021 Ban on 18 Companies for ‘Dealing in Crypto’ and Weakening the Naira

According to several local reports, the Central Bank of Nigeria has lifted bans on several fintech and forex players which were banned during the crypto ban period of 2021.

The Central Bank of Nigeria (CBN) has directed banks to vacate a post-no-debit restriction placed on the bank accounts of 440 individuals and companies. A post-no-debt restriction means that all debit transactions, including ATMs and cheques, on the accounts have been blocked but can receive inflows.

The circular was issued by A.M. Barau on behalf of the CBN Director of Banking Supervision, directing banks to inform the respective customers about a certain development. However, the circular did not provide any specific reasons for this action taken by the central bank.

The list of affected entities comprises of:

• Bamboo Systems Technology Limited
• Escale Oil & Gas Limited
• Rise Vest Technologies Limited
• Chaka Technologies Limited
• AbokiFX Limited
• Nairabet International
• Northwood Energy Services
• Proport Marine Limited

and various others.

The circular reads:

“You are hereby directed to vacate the Post-No-Debit restriction placed on the accounts of the under-listed bank customers at our instance.”

In 2021, the Central Bank of Nigeria (CBN) issued instructions to banks, directing them to freeze the accounts of 18 companies. These companies covered a wide range of industries, including bureaux de change, construction firms, investment companies, money laundering services, and property companies.

All 18 companies have had their bank accounts unfrozen by the apex bank.

Back in September 2021 as the CBN felt the heat of a weakening local currency, we reported on the freezing of bank accounts belonging to 4 investment startups namely:

• Risevest
• Bamboo
• Trove
• Chaka

In 2021, CBN accused the startups of utilizing forex sourced from the Nigerian forex market for purchasing foreign bonds/shares in contravention of a CBN provision issued in 2015.

As a consequence of the forex trades that the companies were involved in, the bank said that the companies were making the Naira weaker to the United States dollars, hence, the need to block 15 of their accounts for 180 days. They were also accused of dealing in cryptocurrency.

Moreover, in an affidavit, the bank claimed that the platforms were violating Nigeria’s trading laws including dealing in cryptocurrency in contravention of the CBN policy.

In September 2021, FX rates aggregator, AbokiFX, was also forced to suspend operations after it was accused by then Governor, Godwin EMefiele, of manipulating rates. The platform said it does not trade FX nor does it create the rates and thus lacks the power to manipulate rates. It said it only publishes the information it gets from BDCs (Bureau de Change) and parallel rate dealers.

Emefiele was suspended as CBN Governor by the new President, Bola Tinubu, in June 2023.

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