Kenya digital currency-friendly fintech Flutterwave and Chipper Cash operating illegally: central bank

The Kenyan central bank has accused two of Africa’s leading fintech firms of illegally operating in the East African country. The two digital currency-friendly fintech companies, Flutterwave and Chipper Cash, have reportedly been operating without a license, even as the former contends with allegations of being used to launder over $50 million.

Central Bank of Kenya (CBK) Governor Patrick Njuguna revealed that the two hadn’t obtained the required licenses while addressing journalists at the end of a recent monetary policy committee meeting. 

“Flutterwave is not licensed to operate remittance provider or for that matter as a Payment Service Provider in Kenya. They are not licenced to operate and therefore they shouldn’t be operating. And Chipper we could also say the same,” the governor revealed, as reported by local outlets.

Flutterwave and Chipper Cash are two of Africa’s largest fintech. The latter was founded in 2018 and focuses on cross-border payments via its mobile app. It also allows users to buy and sell digital currencies. In November last year, it raised $250 million at a $2 billion valuation in its Series C funding round, which was led by FTX, the exchange led by the controversial Sam Bankman-Fried. 

Flutterwave raised $250 million in February this year at a $3 billion valuation, making it Africa’s most valuable startup. It also ventured into digital assets, partnering with Binance to offer a fiat-to-crypto gateway. However, unlike its peer, Flutterwave was already in regulatory troubles, being pursued in Kenya for allegedly facilitating the laundering of at least $52 million.

While Chipper Cash hasn’t responded to the CBK’s claims that it has been operating illegally, Flutterwave has shifted the blame to the central bank.

According to a report by Kenya’s Business Daily, Flutterwave claims it applied for the CBK license back in 2019.

“In 2019, as our operations grew, Flutterwave submitted its application for a payment service provider licence. We have been in constant engagement with the Central Bank of Kenya to ensure that we provide all the requirements and we look forward to receiving our licence,” it said.

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