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Though the year 2019 has come and gone, the financial service delivery industry witnessed a boom, as Financial Technology (FinTech) firms experienced improved growth with the help of technology. The operators have become some of the fastest-growing technology firms in Nigeria.

That is not all. The industry also attracted over $400 million as investment in 2019 alone, according to the Central Bank of Nigeria (CBN).

OPay secures $50 million capital raise from Chinese investors

Why it matters: The apex bank’s Governor, Godwin Emefiele, explained that the investment attracted by the industry was part of initiatives to drive financial inclusion in the banking sector.
He said, “In an effort to build a more inclusive financial system and to improve the efficacy of monetary policy tools, we provided super-agent licenses, as well as Payment Service Bank licenses to telecommunications and fintech companies.
“These measures are aiding in the development of a robust payment infrastructure and an expansion of agent locations across the country. As a result of our policy measures, in 2019, over $400m have been invested in fintech companies focused on supporting improved payment services in Nigeria.”

[READ MORE: Fast loan: Carbon, Page, Okash, other start-up fintechs wrestle banks)


With the entrance of new players into the payment services market and the strengthening of the financial networks, a growing number of underserved Nigerians had access to cost-effective banking services.


  • On November 12, 2019, Interswitch, Africa-focused integrated digital payments, and Visa (NYSE: V), announced a strategic partnership that further advances the digital payments ecosystem across Africa.
  • As part of the agreement, Visa will acquire a significant minority equity stake in Interswitch at a total company valuation of $1 billion. Visa is thought to be paying $200 million, valuing Interswitch at about $1 billion (N360 billion)
  • Founded in 2002, Interswitch reportedly generates annual revenue of N30 billion, suggesting that the current value is about 10x its current revenues. Interswitch is also now valued higher than FBNH (N208 billion), UBA (N225 billion) and Access Bank (N327 billion). Zenith Bank still owns a 5% stake in Interswitch and is currently valued at N538.4 billion.
  • In addition to its switching and processing services, Interswitch owns Verve, the largest domestic debit card scheme in Africa with more than 19 million cards activated on its network as at May 2019, and also operates Quickteller, a leading multichannel consumer payment platform, driving financial inclusion across Nigeria.


Transsion/OPay & Palmpay

In two separate rounds, Chinese investors put $220 million into OPay and PalmPay, two fledgeling startups with plans to scale in Nigeria and the broader continent.

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  • PalmPay, a consumer-oriented payments product, went live in November with a $40 million seed round led by Africa’s biggest mobile-phone seller, China’s Transsion.
  • The startup was upfront about its ambitions, stating in a company release, its goals to become “Africa’s largest financial services platform.”
  • To that end, PalmPay conveniently entered a strategic partnership with its lead investor. The startup’s payment app will come pre-installed on Transsion’s mobile device brands, such as Tecno in Africa, for an estimated reach of 20 million phones.

[READ ALSO: CBN OMO Blues: Your FinTech saving app could suffer bigly)


Nigerian Fintech startup, TeamApt also raised $5.5 million capital in a Series A round led by Quantum Capital Partners in February. The Lagos based firm is expected to use the funds to expand its white label digital finance products and pivot to consumer finance with the launch of its AptPay banking app.

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Founded by Tosin Eniolorunda, TeamApt supplies financial and payment solutions to Nigeria’s largest commercial banks including Zenith Bank Plc, UBA Plc, and ALAT among others. For Eniolorunda, launching the fintech startup means competing with his former employer, Interswitch.


On performance, TeamApt claims 26 African bank clients and processes $160 million in monthly transactions, according to company data. Though it does not produce public financial results, it claimed revenue growth of 4,500 percent over a 3-year period.


Another Tech startup, Andela raised $100 million in Series D funding in January 2019. Generation Investment Management (Generation IM) led the current funding round.

Proceeds of the funds, according to Andela’s country director, Omowale David-Ashiru will be used for expansion.

“Due to our unwavering commitment to our mission throughout the last four years, Andela has grown into a thriving platform for hundreds of technologists in Nigeria. With this investment, Andela will accelerate the development of Africa’s best tech talent in Nigeria and beyond.”


Lilly Wollman, Co-Head of Growth Equity at Generation Investment Management stated that the private equity firm believes there is room for growth in Andela’s area of operations.

She said, “The global demand for software engineers far exceeds supply, and that gap is projected to widen. Andela’s leading technology enables firms to effectively build and manage distributed engineering teams. We are great admirers of the outstanding team, mission and culture Andela has built across two continents and five countries.”

Hurdles of the industry

Like other sectors, FinTech also has its challenges. From lack of appropriate regulation to access to credit, lack of established database, strategic partnership and corporate governance limitations among others, the industry still has a long way to go.

No wonder, FT Partners declared that the nation’s journey to becoming the Giant of Africa, especially in financial inclusiveness, is farther than it appears, as its payments market fell behind other African nations like Kenya, and South Africa.

In FT Partners’ FinTech Industry research, it found that 6% of the nation’s bankable population has mobile money accounts. The report, which was obtained by Nairametrics, rated the most populous black nation behind Kenya’s 73% and South Africa’s 19%.

Also, Nigeria’s Smartphone penetration (27%), accounts in financial institutions (39%) and debit/credit card ownership (35%) all fell behind Kenya’s 60%, 56%, 44%, and South Africa’s 64%, 67%, 43% respectively.

In all, while the firms are trying to keep their heads above water, Emefiele explained that as part of the bank’s priorities for 2020, it would also, sustain these efforts in 2020 as part of its plan to reduce financial exclusion rate to under 20% over the next year.

[READ FURTHER: Banks, Fintechs, Telcos, others may lose 2% annual revenue to data breach – NITDA)

The CBN governor assured that the apex bank would also improve access to credit for stakeholders by deepening their intervention efforts.

He said the bank, in pushing to improve access to finance and credit would protect them from unfair banking and lending practices by maintaining oversight on the banks and other financial institutions.


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