The the Central Bank of Kenya has stated that Olugbenga Agboola’s Flutterwave and Ham Serunjogi’s Chipper Cash offer remittance services and operate payment businesses in Kenya without the necessary licenses.
Kenya’s apex monetary authority made the statement on Wednesday during its Monetary Policy Committee meeting. The news has been characterized as a regulatory setback that could impact the operations of the fintech behemoths and the expansion of the African fintech ecosystem.
Patrick Njoroge, the governor of the Central Bank of Kenya, stated that both Flutterwave and Chipper Cash are not permitted to operate remittance businesses or provide payment services to merchants in Kenya.
“In Kenya, Flutterwave is not licensed to operate as a remittance provider…or as a payment service provider,” he said. “They aren’t licensed to operate, so they shouldn’t be operating… and Chipper, we could say the same thing.”
Njoroge’s statement comes nearly three weeks after Flutterwave denied links to a $59-million money laundering scheme in Kenya, which resulted in the closure of its bank accounts.
Prior to denying the allegations, a West Africa Weekly investigation accused Agboola, Flutterwave’s CEO and co-founder, of serial financial misconduct, including insider trading, fraud, and perjury.
The Central Bank of Kenya recently announced that it will begin regulating mobile-based money transfer services, payments, and micro-finance services given the large volume of transactions that they are capable of handling.
Customers are now bypassing banking apps and services altogether, according to a recent report by commercial banks operating the traditional banking model that reached the regulatory body.
As a result, the apex bank is set to monitor Safaricom’s M-PESA, Craft Silicon’s Little, and other payment service operators.
