The article discusses the challenges of Islamic microfinance in Nigeria, focusing on regulatory issues and operational obstacles. The guidelines set by the Central Bank of Nigeria in 2011 have not been fully embraced by microfinance banks, leading to slow progress in offering Islamic financial services. The main challenges identified include regulatory gaps, lack of trained staff, and the difficulty of integrating Islamic finance into the existing interest-based system. The paper suggests creating separate guidelines for microfinance banks and investing in training for Islamic finance professionals to improve the situation.