A day after Central Financial institution of Kenya (CBK), Kenya’s financial authority, mentioned that Chipper Money and Flutterwave weren’t licensed to function within the East African nation, the regulator has directed all monetary establishments to stop doing enterprise with the 2 fintechs.
The CBK’s financial institution supervision deputy director, Matu Mugo, directed all regulated banks, microfinance and mortgage finance establishments to cease their partnerships with the 2 startups with quick impact — dealing a blow to Flutterwave and Chipper Money, a few of Africa’s highest valued startups.
The letter to the CEOs adopted remarks by CBK’s governor, Patrick Njoroge, that the 2 startups usually are not licensed remittance or fee service suppliers in Kenya — one of many largest fintech hubs in Africa.
“It has come to the eye of the Central Financial institution of Kenya (CBK) that Flutterwave Funds Expertise Restricted and Chipper Applied sciences Kenya (Chipper) have been participating in cash remittance and funds companies with out licensing and authorization by CBK…You’re due to this fact directed to instantly stop and desist from coping with Flutterwave and Chipper,” mentioned Mugo within the letter.
Flutterwave, which can be going through cash laundering allegations in Kenya, in an announcement mentioned it has been working within the nation by means of partnerships with regulated banks and telecoms, because it waits for a funds service supplier license it utilized for in 2019.
Flutterwave, which not too long ago raised $250 million at a $3 billion valuation, facilitates cross-border funds transactions of small to massive companies in Africa by way of one API. A few of its worldwide purchasers embody Reserving.com, Flywire and Uber. In a February interview with TechCrunch, the African funds big, with an infrastructure attain throughout 34 nations on the continent, mentioned it was processing 200 million transactions price greater than $16 billion.
Chipper Money can be a cross-border funds firm with operations in Nigeria, Ghana, Uganda, Nigeria, Tanzania, Rwanda and South Africa.