The Central Bank of Nigeria has revoked the licenses of nine out of the 34 microfinance banks in Niger state.
The National Association of Microfinance Banks confirmed on Monday in Bida that they have lost their operational banking licences.
Sado Daniel, North Central secretary of the association made the remark while inaugurating a micro-finance bank established by the Federal Polytechnic, Bida.
Daniel said: “These micro-finance banks lost their licences because they fell short during the regulation exercise carried out by the Central Bank of Nigeria (CBN).”
He said non-adherence to corporate governance contributed to the collapse of the banks, and urged the management and staff members of the new bank to adhere strictly to the rules establishing it.
Daniel added: “Banks do not die, people kill them; please do not kill the Federal Polytechnic Bida Micro-Finance Bank; ensure you adhere strictly to the rules of the game.”
Hajia Hajara Mohammed, a representative of the CBN in Minna, said that insider abuse was another huge factor that contributed to the failure of micro-finance banks across the country.
She urged business people to stop diverting loans collected from banks to other purposes such as marriage among other things different from what the loan was meant for.
Mohammed said: “until we stop using business money and loans to get married and buy clothes, businesses in the country will not progress.
“If you don’t return your loans there is no way you will benefit from loans being made available by the Federal Government through the CBN.”