On Sunday, Nigerians were thrown into a world of panic as major technology-driven financial institutions on their platforms deleted their bank account data.
Some of the fintech firms include Piggyvest, Risevest, Agropartnership, Chaka and other investment and savings platforms. Removing the specifics of the account is no coincidence. The move was announced by all fintechs that make use of virtual accounts provided by Providus Bank for subscriber savings and investments.
“We received information that the existing Providus Virtual Accounts are inactive from our virtual account provider,” Piggyvest said in a statement.
As a result, the Fintech company had to change the bank account linked to the savings of each user on Piggyvest.
The business assured platform users that all their funds are safe and stable.
In an email to users, another Fintech Monnify revealed that Providus Bank decided that on Friday it will no longer support their virtual accounts.
Monnify asked its users not to panic because it is “working with the bank (Providus) to reconcile accessibility and graceful exit as money in their position.”
The Fintech promised its users that to handle funds and investments in their custody, they would “come back with a new partner bank.”
Fundall also sent its users a similar email saying they would not be able to fund their savings account on the site on Sunday at the moment.
The fintech announced to its customers that it is working to gain charge of “our processes and to reduce third-party reliance.”
“In the coming weeks, we will be completing the integration,” Fundall said in an email to users.
The shift witnessed by other fintech companies has also inspired a stock micro-investment site, Trove Finance.
“We will soon issue new account numbers,” tweeted Trove Finance. “Cards and other channels of payment remain involved.
“Note: This doesn’t affect funds in your wallet.”
Although the cause of the withdrawal of Providus Bank from its partnership with the Fintechs is unclear, many suspect that the Central Bank of Nigeria may be related to the recent policy.
On Friday, CBN instructed banks inside their networks to close accounts of individuals or organizations involved in cryptocurrency transactions.
In a circular distributed to Deposit Money Banks (DMBs), non-bank financial institutions (NBFIs) and other financial institutions, CBN issued the directive (OFIs).
Many of the fintechs whose relationship with Providus Bank has been halted are involved in investments in crytocurrencies, purchasing, selling and converting to the currency of the Nigerian naira.
“Further to earlier regulatory directives on the subject, the bank hereby wishes to remind regulated institutions that dealing in cryptocurrencies or facilitating payments for cryptocurrency exchanges is prohibited, ” CBN’s director for banking supervision Bello Hassan and director of the payment system management department Musa Jimoh said in the circular.
Many Nigerians have continued to accuse the government of implementing anti-people policies.
“The ripple effect of the clampdown on cryptocurrency trading accounts and now Providus Virtual account is worrisome,” Wale Adetona, a digital marketer tweeted. “This is an obvious attack on Fintechs.”
SOURCE: THE GUARDIAN