Why Kenya’s Central Bank Ordered Financial Institutions To Cut Ties With Flutterwave, Others

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Why Kenya's Central Bank Ordered Financial Institutions To Cut Ties With Flutterwave, Others
Why Kenya's Central Bank Ordered Financial Institutions To Cut Ties With Flutterwave, Others

Kenya’s monetary authority, Central Bank of Kenya (CBK) has directed all financial institutions to cease doing business with Flutterwave and Chipper Cash.

Flutterwave is a Nigerian fintech company that provides a payment infrastructure for global merchants and payment service providers.

Chipper Cash, founded in 2018, enables customers to send and receive money across borders. It is available in Nigeria, Kenya, Uganda, Tanzania, Rwanda, Ghana and South Africa.

Speaking to journalists in Nairobi, the country’s capital, Patrick Njoroge, CBK governor, said the two fintech firms are not allowed to operate remittance services or offer payment solutions to merchants in the East African country.

“Flutterwave is not licensed to operate as a remittance provider or, for that matter, as a payments service provider in Kenya,” Njoroge said.

“They are not licensed to operate, and therefore they shouldn’t be operating, and Chipper Cash, we could also say the same.”

Flutterwave is facing allegations of money laundering by Kenya’s Assets Recovery Agency (ARA).

Last month, a Kenyan high court froze more than Sh6.2 billion spread in 62 bank accounts belonging to Flutterwave and four Kenyans.

The court issued the freezing order following suspicion that the funds are proceeds of card fraud and money laundering.

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But the company denied the allegations, describing them as “entirely false”.

“Claims of financial improprieties involving the company in Kenya are entirely false, and we have the records to verify this,” Flutterwave had said.

“We are a financial technology company that maintains the highest regulatory standards in our operations.

“Our anti-money laundering practices and operations are regularly audited by one of the Big four firms. We remain proactive in our engagements with regulatory bodies to continue to stay compliant.”