Central Bank of Nigeria Modernizes Microfinance Bank Licensing with Digital Platform – In an era where digital transformation is imperative, the Central Bank of Nigeria (CBN) is not left behind. The CBN has taken a significant step in streamlining the process for obtaining microfinance bank (MFB) licences. They’ve introduced a contemporary online system named the CBN Licensing, Approval and Other Requests Portal (CBN LARP). This initiative signifies the CBN’s commitment to making financial services more accessible, efficient, and modern.
What is the CBN LARP?
CBN LARP is an online portal, set to replace the traditional manual process of submitting MFB licence applications. Before this, applicants had to go through the tedious process of submitting physical applications. However, with the launch of this platform, the entire process is expected to be more seamless and efficient. What’s even more exciting is that this innovation will soon be extended to other licensing categories.
Why is this significant?
Isa AbdulMumin, the CBN Director of Corporate Communications, highlighted the manifold benefits of this digitized system. It promises:
- A streamlined application process.
- Significant time savings.
- Improved communication between applicants and the CBN.
- Enhanced security measures ensuring data protection.
AbdulMumin eloquently remarked, “By digitising the application process, the Bank aims to improve accessibility, reduce paperwork, and expedite licence approvals, benefiting both applicants and the economy.”
Beginning September 25, 2023, there will be a transition period where applicants will be expected to submit both hardcopy and online applications. This phase ensures that the system runs smoothly and any issues can be addressed promptly. However, come the New Year, on January 1, 2024, the CBN will solely accept online applications, making the old manual method obsolete.
For those keen on starting their online application process, they can easily head over to www.larp.cbn.gov.ng and follow the user-friendly instructions. For any queries or clarifications, a dedicated helpdesk is available at email@example.com.
What about other licence types?
For now, the CBN will continue to accept manual applications for all other licence types. However, given the bank’s progressive approach, it might not be long before other licensing processes also go digital.
The Bigger Picture
Microfinance banks play a pivotal role in Nigeria’s financial landscape, catering to those often overlooked by conventional financial institutions. With a current financial inclusion rate of 64%, the CBN is ambitious, targeting a whopping 95% by 2024.
Despite economic challenges causing a downturn in the number of microfinance banks, a few leaders like LAPO MFB, AB, Baobab, Lovonus, and Addosser have emerged, distinguishing themselves with their innovative tech-driven services.
This move by the CBN is not just about modernizing the licensing process; it’s about broadening financial inclusion, fostering economic growth, and placing Nigeria at the forefront of digital banking transformation.