BREAKING: Opay, PalmPay, Others Ban Customers From Trading Cryptocurrencies

Opay, PalmPay

Opay, and PalmPay, among other fintech apps, have banned their customers from trading cryptocurrencies.

NewsOnline Nigeria reports that the leading Nigerian fintech companies have banned their customers from trading cryptocurrencies and other virtual currencies on their platforms.

This Nigeria news platform understands that the firms including OPay, Moniepoint, PalmPay, and Paga threatened to block any accounts found to be engaging in such activities.

Last week, the CBN imposed restrictions on major fintech firms such as Kuda, OPay, PalmPay, and Moniepoint, prohibiting them from onboarding new customers.

This decision is part of a broader audit of the Know-Your-Customer (KYC) processes implemented by these fintechs, amidst growing concerns over potential money laundering and terrorism financing.

The clampdown on cryptocurrency transactions comes in the wake of the Economic and Financial Crimes Commission (EFCC) obtaining a court order to freeze at least 1,146 bank accounts due to alleged involvement in illegal foreign exchange transactions.

The CBN has maintained a firm stance against the use of digital currencies, citing the need to protect the financial system from the risks associated with their trade.

In response to these regulatory pressures, OPay issued a notice last Friday, reaffirming its commitment to adhering to the CBN’s guidelines.

The notice emphasized that strict measures would be taken against any customers who violate the company’s policy on cryptocurrency trading.

“In compliance with the CBN directive, please note that OPay prohibits any cryptocurrency and all virtual currency trading. Any account engaging in such activities will be closed, and customer information will be shared with regulatory authorities.

“Please ensure that your account does not involve any cryptocurrency or any other virtual currency transaction,” the fintech firm warned.

In a similar move, Paga, a fintech firm that has processed transactions worth $32bn in 15 years of operation, said in an email to its customers, “As a Paga account holder, please ensure that your account is not used for crypto and virtual currency transactions. Paga accounts in violation of this regulation will be blocked.”

PalmPay, another major player in an emailed statement said, “We strongly advise against using your PalmPay account for transactions involving cryptocurrencies or any other virtual assets. Please be advised that failure to comply with these regulations may result in the suspension of your account.

“Our team is diligently working to ensure full compliance with all regulatory directives, prioritizing the stability and integrity of our platform,” the fintech stated.

On Thursday in Lagos, the founder and CEO of Moniepoint, Tosin Eniolorunda, called on cryptocurrency peer-to-peer (P2P) participants to halt their activities, citing the financial sector’s prohibition on such transactions.

“This is a self-reflection of our industry. As you know, fintech apps are used for fraud. One of the things that led to the most recent announcement is that crypto players were manipulating the naira, especially with the P2P market,” he said.

Recently, NewsOnline Nigeria reported that the key players in the fintech sector were summoned to Abuja for discussions on KYC protocols, underscoring the regulatory scrutiny facing the industry.

The apex bank had also crackdown on cryptocurrency exchange, Binance in February after being accused of manipulating the naira exchange rate.

Before Binance stopped operation, CBN Governor Olayemi Cardoso said nothing less than $26bn was moved by unknown sources through Binance Nigeria in one year.

The CBN and the Office of the National Security Adviser (ONSA) announced a partnership to investigate and penalise those involved in illicit activities within the FX market.