Fidelity Bank said it decided to block transfers to OPay, Moniepoint, and Palmpay over KYC concerns
Fidelity Bank, one of the leading banks in Nigeria, recently announced that it has blocked transfers to OPay, Moniepoint, and Palmpay from its bank app. The reason for this decision is to protect its customers from fraud and money laundering activities that are rampant on these platforms.
OPay, Moniepoint, and Palmpay are examples of neobanks, which are digital-only banks that operate without physical branches. They offer various financial services such as savings, loans, payments, and investments through mobile apps or web platforms. They also partner with POS agents who act as their representatives in different locations.
Neobanks are popular among Nigerians because they offer convenience, speed, and low fees. They also claim to have less stringent KYC (Know Your Customer) requirements than traditional banks, which makes them attractive to people who do not have formal identification documents or utility bills.
However, the ease of opening and operating neobank accounts also makes them vulnerable to abuse by fraudsters and criminals. According to a report by [Nairametrics], neobanks have become the preferred channels for receiving stolen funds by cybercriminals and internet fraudsters.
