The Central Bank of Kenya (CBK) says that leading African Fintech firms, Flutterwave Payment Technology Limited and Chipper Cash, are not licensed to operate remittances or payment services in the East African country.
Flutterwave and some other Fintech companies have been subject of intense scrutiny by the Kenyan government over the past few months with their operations being affected.
This was made known on Thursday by the Governor of CBK, Patrick Njoroge, at a press conference following a meeting of the Kenyan apex bank’s Monetary Policy Committee in Nairobi.
What the CBK Governor is saying
Njoroge, who singled out Flutterwave and Chipper Cash for not having operator permit during the virtual press briefing, said, “Flutterwave is not licenced 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 and I think Chipper Cash, we could also say the same.’’
What you should know
- Recall that about 3 weeks ago, a Kenyan High Court had seized Sh7 Billion ($59 million), from 56 accounts belonging to Flutterwave and some other Fintech companies over allegations that they were being used as conduits for money laundering in the guise of providing merchant services.
- Kenya’s Asset Recovery Agency (ARA) had informed the court that the company’s account received billions of shillings and the same was deposited in different bank accounts in an attempt to conceal the nature, source or movement of the funds.
- However, in its reaction, Flutterwave Kenya, dismissed the claims, denying involvement in any financial improprieties in the guise of providing merchant service as contained in recent reports, saying that it earns its fees through a transaction charge, records of which are available and can be verified.
- The Kenyan court still granted the order freezing three Flutterwave accounts with funds amounting to about $43 million in various currencies.
- African cross-border fintech startup, Chipper Cash is a financial services company that features a software application platform that enables free instant cross-border mobile money transfers in Africa as easy as sending a text message. The company was founded in 2017 and is headquartered in San Francisco, California.
Kenya, which is a pioneer in mobile money with M-Pesa, has been mulling the idea of launching a Central Bank Digital Currency in the country, which is considered a major market in the African continent for mobile payments and remittances.