NDIC Takes Over 46 Microfinance Banks, Begins Depositor Payments

The Nigeria Deposit Insurance Corporation (NDIC) has commenced the liquidation of 46 Microfinance Banks (MFBs) whose operating licences were revoked by the Central Bank of Nigeria (CBN), assuring affected depositors that the process of verifying claims and paying insured deposits has already begun.
The move follows the CBN’s decision to withdraw the operating licences of the 46 microfinance institutions with effect from July 1, 2026, citing its statutory powers under the Banks and Other Financial Institutions Act (BOFIA), 2020.
Following the revocation, the NDIC was officially appointed as the liquidator of the failed institutions in accordance with Section 12(2) of BOFIA 2020 and Sections 55(1) and 55(2) of the NDIC Act 2023.
In a statement issued by the Head of Communication and Public Affairs Department, Hawwau Gambo, the Corporation said the affected banks have ceased to operate as licensed financial institutions and are no longer permitted to carry out banking business in Nigeria.
The NDIC disclosed that it has immediately taken possession of the failed banks and activated the statutory liquidation process aimed at protecting depositors, preserving the remaining assets of the institutions and ensuring an orderly resolution of the failed banks.
According to the Corporation, the first phase of the exercise involves taking over the institutions, verifying deposit liabilities, identifying eligible depositors and paying insured deposits in line with the provisions of the NDIC Act.
The Corporation emphasized that safeguarding depositors remains its foremost responsibility, noting that every eligible depositor will receive insured compensation while efforts continue to recover and realise the assets of the failed banks for the benefit of uninsured depositors and other creditors.
“The NDIC has commenced the process of the orderly closure of the failed banks with their immediate takeover, verification and payment of insured sums to eligible depositors. Depositors and the general public will be duly informed on an ongoing basis on further steps to be taken regarding the liquidation exercise,” the statement said.
The Corporation also issued a strong warning to members of the public against conducting any transaction with the affected banks, stressing that their banking licences have been revoked and they are no longer authorized to provide financial services.
It further cautioned individuals against attempting to remove, conceal, retain or interfere with the assets, records, documents or other properties belonging to the failed institutions, warning that such actions constitute violations of Nigerian law and may attract criminal prosecution.
Financial analysts say the swift intervention by the NDIC demonstrates the effectiveness of Nigeria’s financial safety-net framework designed to protect depositors and preserve confidence in the banking system whenever financial institutions fail.
Industry observers also noted that the immediate commencement of insured deposit payments is expected to reduce uncertainty among customers of the affected banks while minimizing disruption to financial inclusion efforts, particularly in rural and underserved communities where microfinance banks play a significant role.
The latest action represents another major regulatory step by Nigerian financial authorities to strengthen the stability of the banking sector by removing distressed institutions that are unable to meet prudential requirements while ensuring that depositors are protected through the deposit insurance scheme.
The NDIC advised affected customers to remain calm and await further announcements on payment procedures and liquidation updates through its official communication channels.
The Corporation also encouraged members of the public to consult the official list of the affected 46 Microfinance Banks published on its website for verification and additional information.
The development underscores the commitment of Nigeria’s financial regulators to promoting a sound, resilient and well-regulated banking industry while maintaining public confidence in the country’s financial system.
The NDIC has taken over 46 Microfinance Banks following the CBN’s licence revocation and has commenced verification and payment of insured deposits to eligible customers while warning against transactions with the failed institutions.