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Business News

OPay reacts to office shutdown, N25 million license fee 

Days after Kano State government shut down the office of online payment firm, OPay, the company’s Country Manager for Nigeria, Iniabasi Akpan, has reacted to claims that OPay failed to secure necessary approval and authorisation from the state government.

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OPay reacts to office shutdown, N25 million license fee 

Days after Kano State Government shut down the office of online payment firm, OPay, the company’s Country Manager for Nigeria, Iniabasi Akpan, has reacted to claims that OPay failed to secure necessary approval and authorisation from the state government. He also highlighted the impact that the closure would have on the state. 

In an interview with Nairametrics, Akpan said that the State government didn’t shut down its operation in Kano, clarifying that the government only closed its office. According to him, business is still running as usual. 

It had been previously reported that OPay’s office was shut by the Nigerian Police Force on Friday, September 20, 2019. The spokesman of the Police Command, DSP Abdullahi Haruna Kiyawa said that OPay was accused of non-compliance with the rules and regulations of the State. 

However, Akpan maintained that the office had been closed for no reasonas OPay didn’t receive any formal statement or communication from the Kano State Government. He further stated that the company was in the dark concerning the reason behind the closure. 

Is OPay being bullied? 

While reacting to the closure, Akpan told Nairametrics that for the closure to have occurred without proper communication from the government, it means that someone was trying to bully OPay. 

[READ ALSO: One of Nigeria’s oldest publishing houses is worth less than a million dollars]

Nairametrics learnt that OPay has every necessary authorisation to operate in Kano, “We are not out of Kano. We still in Kano State and we are still operating. Our operation isn’t shut down, (but) the office is shut down.  

“We don’t have any official communication from any authority othe reason why it was shut down. So you get the feeling that someone is trying to bully us or someone is trying to play a fast one on us because that’s how vested interest works. 

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“There’s no official (statement), nothing from the Kano State government on why the office is shut down. 

We’ve been operating in Lagos; what formal authorisation do we need to go operate a business in (Kano). We are not clear what the (formal authorisation is) because we have everything that we need to be able to function in Kano. We have all the approvals that we need. 

So we don’t understand what other authorisation is required beyond the usual ones of making sure that we pay our taxes.” 

OPay is owned by Opera Group CompanyIt is the payment platform for the company’s other subsidiaries OFoodOBus and ORidewhich have operations in eight cities across Nigeria, including Lagos, Ibadan and Aba. 

Impact of closure

The closure sends a frightening message to investors willing to set up business in Kano State. For OPay not to receive any formal statement from the government regarding their operation in Kano before the closure of its office, it says a lot about the ease of doing business in Kano State. 

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Akpan also voiced this worry during the interview, stating that, “I think that’s a way to frustrate investment from coming to a state.”  

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Dialogue between OPay and Kano

OPay is in talks with the Kano State government to determine what led to the closure because the mobile money company insists that it has all needed approvalto operate in the state, “We are engaging the Kano State government to understand why our office is closed.” Akpan said. 

OPay is open to regulation

Despite the rivalry between ORide and Gokada, there’s one thing both companies agree on, and that’s for the bike-hailing market to be regulated. 

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However, Akpan urged that regulation should be balanced, as over-regulation also has its negative impact just like underregulation does, “Regulation is important, but I believe there can be underregulation and over-regulation.  

Under-regulation is not good because the quality of service will be affected if there’s under regulation. And if there’s over-regulation, then it stifleinnovation and creativity. 

“So there must always be a balance, so we are open to regulation. That’s why we are working with regulators. Some things are being refined and finalised on what the license fee will be and other stuff.” 

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Lagos State license fee

The Lagos State Government is reportedly planning to introduce N25 million annually per 1,000 bikes for the bike-hailing market. But Akpan said talks are still ongoing on the license fee, “Nothing has been finalised; discussions are ongoing about it. So definitely, there’s going to be a license fee.  

[READ ALSO: Nigeria needs $100 billion annually to fix infrastructural deficit – Finance Minister]

And that’s part of making sure that serious players, the right players get into the business. And also making sure that not just any Tom, Dick and Harry opts in.” 

 

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Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: [email protected]

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Companies

Nestle declares N28.1 billion as final dividend for 2020

The Board of Nestle Nigeria Plc has announced the payment of N28.1 billion to its shareholders as the final dividend for 2020.

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Nestle declares N28.1 billion as final dividend for 2020

The Board of leading consumer goods company, Nestle Nigeria Plc, has announced the payment of N28.1 billion to its shareholders as the final dividend for the period ended 31st December 2020.

According to the announcement published by the company on the website of the Nigerian Stock Exchange, Nestle is expected to pay a final dividend of N35.50 per share for all the outstanding 792,656,252 ordinary shares of the company.

This brings the total dividend payout to qualifying shareholders to N28.14 billion.

The final dividend, however, will be paid electronically to shareholders on the 23rd of June, 2021, subject to appropriate withholding tax and approval at the Company’s Annual General Meeting.

Other key conditions outlined by the company for qualifying shareholders include:

  • Shareholders whose names appear on the registrar of members as of 21st of May, 2021 will be considered.
  • Qualifying Shareholders must have completed the e-dividend registration and must have mandated the Registrar (Greenwich Registrars) to pay their dividends directly into their bank accounts.
  • In line with this, the register of shareholders will be closed from 24th of May to 28th May 2021, to enable the registrar to process the dividends of Nestle’s shareholders.

In case you missed it

  • Nestle paid an Interim dividend of N25 per share to shareholders towards the end of 2020.
  • It is important to note that the addition of this to the final dividend of N35.5, puts Nestle’s total dividend for 2020 at N60.5 per share. This is 13.57% lower than the total dividend payout for 2019 (N70 per share).

What you should know

  • Nestle declared in its audited financial statement for 2020, that it made a profit before income tax of N60.6 billion in 2020. Indicating a decline of 14.74%, when compared with 2019 figures.
  • The company’s earnings per share (EPS) during the period under review was N49.47, 14.16% lower than 2019 EPS.

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Companies

MTN Nigeria declares largest ever revenue by a listed Nigerian entity for FY 2020

The strong revenue growth was basically due to its data-led segment as sales from the segment expanded by an impressive 51.5% Year to Year.

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UACN appoints Toriola as new Director 

MTN Nigeria recently announced another ground-breaking full-year turnover in the financial year of 2020, the highest ever recorded by a Nigerian listed entity.

Specifically, the telecom giant’s revenue expanded by 15.1% year-to-year to N1.3 trillion in the review period. The strong revenue growth was basically due to its data-led segment as sales from the segment expanded by an impressive 51.5% Year to Year.

  • Voice sales rose relatively by 5.6% year to year as the global switch to data-enabled communication subsisted.
  • MTN Nigeria Plc also announced a N5.90/share final dividend on impressive growth in its free Cash Flow for the financial year of 2020.
  • Notably, MTNN’s 4G network now covers 60.1% of the population compared to 43.8% in 2019.
  • According to MTN Nigeria, the suspension of new SIM registration enforced in mid-December did not have a material effect on the voice segment, which managed a 10.6% YoY revenue growth in Q4’20 (vs 7.0% YoY in Q3’20).

READ: MTN Group set to sell-off its 20% shareholding in BICS for $121million

In contrast, data revenue growth notably moderated to 37.5% YoY in Q4’20 compared to 55.5% YoY in Q3’20.

In a research report released by CardinalStone, the most valuable telecom company’s margin was adversely affected by currency devaluation;

“Margins were adversely affected by the effect of naira devaluation and expenses associated with new sites’ roll-out to boost 4G network coverage in FY’20.

“On the former, we note that MTNN expanded the scope of its service agreement with IHS Holding Limited and changed the reference rate for converting USD tower expenses to NAFEX (vs CBN’s official rate previously). Thus, over the full-year period, the company’s operating margin contracted by 1.9 ppts YoY to 31.7%,” the report stated.

READ: Analysis: Airtel is winning the data war

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The company’s margin was also negatively affected by the higher cost of borrowing and the ultra-low rates prevailing at Nigeria’s debt market;

“Net finance cost increased by 25.4% YoY on the impact of higher borrowings and lower interest on investment in government securities.

“Borrowings rose by over 26.3% to N521.2 billion in FY’20, after the company notably issued its N100 billion Commercial paper in June 2020. The effect of higher borrowings combined with a tax increase (a consequence of lower investment allowance and exempt income) to keep after-tax profit growth subdued at 0.9% YoY.”

That being said, in spite of its impressive growth in revenue the Stock was trailing by 3.28% trading at N174 per share.

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