The Governor of Kenya’s Central Bank, Dr. Patrick Njoroge has finally made it clear that Africa’s biggest fintech and highest valued startup Flutterwave is not licensed and should not be operating in Kenya.
“Flutterwave is not licensed to operate as a remittance provider or payments service provider in Kenya. They are not licenced to operate and therefore, they should not be operating,” the Governor said at a virtual post Monetary Policy Committee briefing.
He also noted that Chipper Cash, another fintech in that country is also not licensed, saying that “I think Chipper Cash, we could also say the same.”
The central followed it up with a statement today, July 29, 2022 stating categorically that the two fintechs have not license to operate in Kenya so any banks and financial institutions which do businesses with them should quit immediately.
Find the letter attached:
A court in Kenya recently froze more than $50 million in accounts belonging Flutterwave under the country’s anti-money laundering laws. Kenya’s Assets Recovery Agency (ARA) was granted a court order to freeze several accounts with three banks belonging to Kenyan-registered Flutterwave Payment Technology Ltd.
Flutterwave issued a statement denying the allegations and claiming that saying its operations were audited and it continuously engaged regulatory agencies to stay compliant.
Flutterwave has been operating in Kenya since its expansion in 2016, and Chipper Cash since 2018.
According to some industry experts, Kenya’s newly-found energy in regulating fintechs can be traced to the release of the Kenya National Payments System (NPS) Vision and Strategy 2021-2025 (PDF) in 2020—a 5-year plan to digitise the country’s payment landscape and establish regulatory standards that make innovation conducive.
It’s also notoriously difficult to get licensed by the CBK. Large companies like Cellulant which has been operating in Kenya since 2003 only got licensed this year. Pepsal has been operational since 2009, but its license came in less than a year ago.
Both Flutterwave and Chipper Cash are yet to comment on the CBK’s latest statement, but it seems like Kenya is tightening its regulatory processes in preparation for its national elections next month where the country will decide who succeeds President Uhuru Kenyatta 9-year reign.