Opay, PalmPay, Others Threaten To Shutdown Accounts Trading Cryptocurrency

Nigerian fintech firms have cautioned their customers against engaging in cryptocurrency or any virtual currency transactions through their platforms, indicating they will block any accounts discovered participating in such activities.

Four fintech companies — Opay, Moniepoint, PalmPay, and Paga—announced this update to their customers on Friday.

Recall that the Central Bank of Nigeria halted major fintech companies like Kuda, Opay, PalmPay, and Moniepoint from accepting new customers last week.

READ: Customers Panic As CBN Bans Moniepoint, Opay, Kuda, Others 

The Central Bank’s action was associated with an ongoing review of the Know-Your-Customer procedures of the fintech companies, which have been under examination in recent months due to worries regarding potential money laundering and terrorism financing.

Before the CBN’s directive, the Economic and Financial Crimes Commission had obtained a court order to freeze at least 1,146 bank accounts owned by various individuals and companies allegedly involved in illegal foreign exchange transactions.

In a notice issued on Friday, OPay said it would take strict measures against customers who violate its policy, which aligns with the Central Bank of Nigeria’s stance 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,” it said.

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, 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.