- Nigerian Fintech company, Flutterwave has ran into troubled waters in Kenya after the Kenyan Central Bank asked it to cease operations
- The Kenyan Central Bank said the company is operating illegally in the country and asked that banks desist from doing business
- The company said it has since applied for license but has not been given and described the actions of the apex bank as a smear
Africa’s biggest unicorn, Flutterwave is on the cusp of being kicked out of the Kenyan market after the country’s Central Bank ordered banks in the East African country to stop doing business with the company.
According to a statement from the Central Bank of Kenya (CBK), Flutterwave Payment Technology Limited and Chipper Technology Limited have been engaged in money remittance businesses without a license from CBK.
Flutterwave not operating according to laws
The bank said that payment services in Kenya are controlled by the Central Bank Act and the Money Remittance Regulations of 2013.
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The country’s apex bank’s helmsman, Patrick Ngoroje was reported by Business Insider as issuing a warning to Flutterwave and Chipper Cash were not licensed to operate remittance services in the country.
Flutterwave said that it initially entered the Kenyan market via partnerships with local banks. Following the growth of its operations, the firm said it applied for a payment service provider approval which is still pending, according to a Bloomberg report.
CBK suspects Flutterwave involved in money laundering
The company ran into troubled waters in Kenya early this year when the country’s Asset Recovery Agency obtained a court injunction to freeze some bank accounts belonging to the company.
CBN seeks court order to freeze accounts of 157 companies involved in diversion of funds for prepaid meters
The bank said it suspects that the $52.5 million found in the accounts belonging to the fintech firm are proceeds of fraud and working assiduously to have the money forfeited to the Kenyan government.
The fintech firm, which rose to unicorn status last year, continues to deny any wrongdoing and describes the actions against it as a smear campaign, saying it partners with other financial firms to receive and make payments for merchants in the country.
Two Nigerian fintech executives jailed in the US for money laundering
Recall that Legit.ng has reported that a Texas court in the US has jailed two Nigerian co-founders of a fintech firm to 27 months in prison for their role in helping to launder $160 million to Nigeria via their company, Ping Express US LLC.
In a statement by the US Department of Justice, last week, the company admitted it did not maintain enough anti-money laundering and unlicensed money transmission checks in the last three years, according to a Premium Times report.
The company also acknowledged it did not seek enough information about the sources or objectives of the funds involved in the transaction.