CBN unveils guideline for non- interest microfinance banking

In a move to encourage the development of the microfinance subsector of the non-interest finance sector and to deepen financial inclusion, the Central Bank of Nigeria (CBN) has released the draft guidelines for the regulation and supervision of Non-Interest (Islamic) Microfinance Banks (NIMFBs) in Nigeria for inputs/comments.

In the document posted on its website, the apex bank placed the NIMFBs into three categories, namely, unit, state and national.

The national NIMFB will be authorised to operate in all the states of the federation, including the FCT. It shall be required to have a minimum paid-up capital of N2 billion, and allowed to open branches in all states of the federation and the FCT, subject to the availability of free funds and the prior approval of the CBN for each new branch or cash centre.

A unit NIMFB is authorised to operate in one location. It shall be required to have a minimum paid-up capital of N20 million and is allowed to have only one branch outside the head office within the same local government area, subject to availability of free funds of at least N20 million and compliance with the prescribed minimum prudential requirements.