Reports have it that the Central Bank of Nigeria could close down about 600 microfinance banks in Nigeriain the coming weeks following their inability to meet the recapitalisation deadline set by the apex bank. Over 800 microfinance banks currently operate in Nigeria.

CBN, which several months ago asked the MFBs to recapitalise, had categorised them under different amounts of capital base requirement. The first group, the Unit Trust MFBs, is expected to have a capital base of N20m. Those in this category, according to the CBN, are expected to operate from only their head office.

The second category, the state level MFBs, is licensed to operate from only a state of the federation and it is expected to have minimum capital of N100m. The third category of MFBs is licensed to operate at the national level. Those in this group are allowed to operate throughout the federation and are expected to have a capital base of N2bn.

It is understood that CBN had appointed some firms to carry out an examination on the MFBs across the country and to check their compliance level.The CBN had in 2010 revoked the operational licences of 224 MFBs as a result of what the regulator termed ‘below performance’ measuring yardstick.