| Nigeria | MTN and Airtel secure approval to operate a Payment Service Bank (PSB). Telecommunication companies, MTN and Airtel, recently announced that they had received approval in principle from the Central Bank of Nigeria (CBN) to operate Payment Service Banks in the country. It was three years ago — in 2018 — that the CBN first announced it would allow non-financial companies to apply for mobile banking licenses – either as PSBs or Mobile Money Operators (MMOs). MTN and Airtel will now be providing PSB services via their respective subsidiaries, MoMo and Smartcash. Techcabal |
| | EDITOR'S NOTE | PSBs are a relatively new type of financial institution in Nigeria, with just 13 licenses issued so far, including MTN and Airtel's recent licenses. PSBs share some similarities to traditional banks. PSBs can offer payments and remittance services, issue debit and prepaid cards, deploy ATMs and other technology-enabled banking services. They are however not allowed to give out credit or loans, or participate in foreign exchange transactions.
PSBs, unlike traditional Deposit Money Banks (DMBs) are setup to focus on offering financial services — at least 25% of their operations — to the underbanked population in remote areas. MTN and Airtel have been testing their feet in the Nigerian financial services space in the past few years through their Mobile Money and Smartcash subsidiaries respectively. This PSB license will finally allow them expand their operations into the space and offer more financial products in coming months.
For a while, telcos in Sub-Saharan Africa have been looking to replicate M-Pesa's Kenya success. With Nigeria as the most populous country in Africa, there's always a market for products that add value. And with financial inclusion still at 51% there's definitely market for mobile money. |
|
|
|
| Can traditional banks compete with fintechs? With the rise of fintech solutions across the world, it's easy to conclude that banks and other traditional players are disadvantaged. In this article, however, Vaibhav Puranik gathers insights from industry leaders on the distinct advantages banks have and how they remain relevant. Fintech Nerd Collective |
| | EDITOR'S NOTE | In the past few years, the African finance industry has experienced disruption with fintechs on the rise. There's speculation that traditional banks will lose out on this race as shared by Ryan of Bankless Nation. However, it's possible that this is only a distant reality. In the near future, banks will continue to collaborate with and enable the success of fintechs with their rails, data and existing relationship with regulators. |
|
|
|
| Ghana | Ghana's Securities and Exchange Commission (SEC) issues guidelines to regularize credit rating industry. The new guidelines require foreign credit rating agencies (CRA) to have a subsidiary in Ghana before they can issue ratings for Ghanaian securities or entities. Foreign CRAs already in business in Ghana are required to comply within a year of the publication of the new guidelines. The BFT Online |
| |
|
|
| Nigeria | Stitch expands into Nigeria and raises $6 million in a seed round. Stitch is a South African API fintech startup that helps connect users' financial accounts to other financial applications. The API fintech startup extended its seed to $6 million, up from the $4 million it announced earlier this year, and also confirmed its expansion into Nigeria. Disrupt Africa |
| | EDITOR'S NOTE | With reported 50% month-on-month growth in its first six months, Stitch has experienced significant growth in the South African market since February, 2021 when it launched. Its decision to expand to Nigeria is also worthy of note as more financial data API companies experience growth and demand for their services in Africa increases. Mono, an African startup that recently announced a $15 million seed round and plans to expand to Ghana and Kenya before the year ends, and Okra, currently live in South Africa, are some of the incumbents in Nigeria.
Generally, Nigeria has been a target for many startup expansions largely because of its population and growing tech ecosystem. It'll be interesting to see how these different startups approach the problem and how they distinguish themselves from others in the market. |
|
|
| Nigeria | Nigerian fintech startup, Payhippo, closes $3 million in seed funding round. This seed round for the Nigerian SME lending startup, Payhippo, was led by a group of African fintech founders and financial leaders. The company plans to use the funds to hire talent as they ramp up their operations within the country. TechCrunch |
|
|
| Egypt | Egyptian fintech startup, Sympl, secures funding From A1. Sympl, a buy-now-pay-later business that allows merchants to sell products and services directly to customers on short-term, interest-free repayment plans, have secured their first funding from A15, a major venture capital firm in the MENA region. Afrikan Heroes |
|
|
| South Africa | Fidelity, Visa and Kingsway back South African fintech JUMO in $120M round. JUMO, a South Africa and London-based banking-as-a-service company, has raised $120 million. The funding round was led by Fidelity Management & Research Company. This marks Fidelity Management's first investment in an African Fintech company and further establishes the attractiveness of the African tech ecosystem. TechCrunch |
|
|
|
Share a tip | Do you have an announcement, event, or job posting you'd like to share, or have you come across an interesting bit of African fintech news recently? Hit reply and let me know! I might be able to include it in next week's newsletter. |
|
Know someone who'd enjoy Decode Fintech? |
|
|
|
|
