The financial technology space in Nigeria is fast becoming a much more competitive sector as more players keep penetrating the economy; there are now more than 250 Fintech companies in the system.
Financial technology (Fintech) is an economic initiative composed of companies or Startups that uses technology to deliver financial services to consumers – the technologies may include the internet, apps, mobile phones and other technological devices.
The core aim of Fintech is to enhance and achieve financial inclusion globally. Fintech companies offer services such as money transfer, depositing a check with your mobile phone, applying for credits, raising funds for business, POS services etc., little or no physical presence because the entire banking process is online. Some of these companies use the Ajo (thrift) scheme method and charge zero interest on loans.
The Nigeria Fintech ecosystem has become an opener for most international Companies in implementing new Strategies for payments.
I have always known that #Nigeria#Tech ecosystem has Brilliant Minds that can shape the future. @stripe is Introducing a feature (No-code Payment Page) that was introduced by paystack,flutterwave & other Fintech more than 5 years ago in Nigeria.@Orbij_ Tweet
10 Popular Fintech Companies in Nigeria
Flutterwave was founded in 2017 by Olugbenga Agboola and Iyin Aboyeji with a branch office in Lagos, and its headquarter in San Francisco. The Fintech company was founded by a team of ex-bankers, entrepreneurs, and engineers to provide the technology needed to give businesses worldwide a robust, reliable and intelligent payments gateway.
In short Flutterwave aims to provides the most accessible and most reliable payments solution for businesses anywhere in the world. It is rated as one of the top FinTech companies in Nigeria that help customers send, receive money and pay bills.
Flutterwave has partnered with over 40 banks across various nations in Africa and has processed as much as 100 million transactions with over 280,000 businesses carrying out businesses on its platform and currently operates in 20 African countries.
In 2019, Flutterwave entered a partnership with Visa to launch Alipay and GetBarter, a consumer payment product created to connect African businesses with businesses in other continents.
In 2021 Flutterwave raised $170 million in its latest round of funding to increase its customer base in the global market; the funding round placed it at over $1 billion in value, making it one of the three unicorns in Africa. The Nigerian payment company has raised not less than $225 million in funding.
This FinTech company also initiated a partnership with Binance, making it possible for Nigerians to buy Bitcoins using the naira currency.
Flutterwave has a mobile app built for both Android and iOS. It is also the developer of Barter and Rave, two popular financial service apps in the market today.
PayStack was established in 2015 by two young ‘tech bros’, Shola Akinlade and Ezra Olubi, with the mindset that even though it is hard to build a business in Africa, getting paid shouldn’t be hard.
Paystack is a growth engine for a new generation of innovative, forward-looking organizations operating in Africa. It helps many of the largest corporate and government organizations in Nigeria get paid quickly and securely.
As YC’s first Nigerian startup, Paystack leads the charge of great Fintech companies coming out of Africa, powering modern payments for the continent. With Paystack, your business can complete payment from clients using Visa cards, Verve cards or Mastercard from any part of the world. The Fintech company is trusted by over 60,000 business clients such as Betway, MTN, IrokoTV, Filmhouse Cinema, AirPeace, Domino and Taxify.
It has been enlisted in the world top 250 FinTech companies alongside two other Nigerian companies.
Paystack was acquired by stripe for over $200 million in 2020; the FinTech company already processed more than half of all online transactions in Nigeria and has ambitious plans to expand across the continent. It recently started a pilot with businesses in South Africa.
Known initially as Piggybank.ng, before it became PiggyVest. PiggyVest was launched on the 7th of January 2016 by Ayo Akinola, Joshua Chibueze, Nonso Eagle, Odunayo Eweniyi, and Somto Ifezue.
PiggyVest is the first online “Savings & Investment” platform in West Africa. It is the leading online savings & investment platform in Nigeria that allows debit cardholders to save tiny amounts of money frequently with minimal effort.
It automates the process of saving tiny amounts daily, weekly, or monthly. With PiggyVest, you get to save money at an interest rate higher than that offered by traditional banks.
It has helped over 2,000,000+ customers save and invested billions of Naira that they would usually be tempted to spend for more than four decades.
PiggyVest offers different saving plans. You can decide to go for the savings feature on the platform, which enables you to automatically set the amount of money you want to save daily. The amount will automatically be deducted from your account every day and kept in PiggyVest until the specified time for withdrawal, where you withdraw with the stipulated interest (current 8% p.a).
The Safelock feature enables you to set up funds and lock them up for a fixed period. You can only withdraw the money when it has matured. It is similar to the fixed deposit account in the traditional banks in Nigeria, except you get to set the tenure yourself and get up to 13% interest (upfront).
There are also other features on PiggyVest, such as the Flex Dollar that enables you to save in dollars, earn interest and transfer dollars to anyone on PiggyVest.
Paga was founded in 2009 by Tayo Oviosu but launched in 2011. It is a mobile payment company building an ecosystem to enable its customers to digitally send and receive money, creating simple financial access for everyone. With over 17 million customers and over 27,000 agents who use Paga to:
- Send Money: Send money instantly to anyone with a phone number, email address or bank account.
- Request Money: Request money instantly from anyone with a phone number or email address.
- Get Remittance: Receive instant and secure money transfers from abroad to any Nigerian mobile phone number or bank account, using Paga.
- Pay Bills: Renew your Pay TV, Internet, Electricity and so much more with Paga’s smooth bill payment service.
- Receive Money: Receive money instantly from anyone with a phone number, email address or bank account.
- Top-up Airtime & Data: Top-up your data and airtime instantly using Paga.
Paga is another company making waves in the FinTech industry. It has made it easy for users to send and receive money in Nigeria and has been featured alongside Paystack in the list of the world top 250 FinTech companies.
Paga is a mobile payment company that is tested, reliable and quick even without an internet connection; users can make payment by simply calling the code, *242#.
In March 2020, Visa announced that it has entered a partnership with Paga on payments and technology. This collaboration enables Paga users to make transactions on Visa’s global network.
In 2020, Paga started making moves to expand to other countries aside from Nigeria. It acquired the Ethiopian software development company, Apposit in January 2020 and also opened an office in Mexico.
5. Kuda Bank
Kudi Money was rebranded to Kuda Bank. It was founded in 2017 by Babatunde Ogundeyi.
Kuda is the first digital-only bank in Nigeria with a standalone licence. Tagged as the bank of the free to help its customers get the best out of their money.
Imagine all the stress your regular bank gives you? Kuda bank was created to remove that stress. It is an online banking platform that allows users to open accounts online and initiate transactions fast. It is one of the top 10 Fintech companies in Nigeria in 2021.
Your phone + Kuda App + free debit card = a simpler life.
With more than a million customer base, the start-up continues to raise funds to enable its expansion, it raises a Pre-seed funding of $1.6 million in 2019, In November 2020 Kuda raised $10 million, the largest seed funding by any African Startup and four months later, it raises another $25million Series A in March 2021 to build Africa’s digital bank.
OPay is a mobile money platform operated by OPay Digital Services Limited and licensed by the Central Bank of Nigeria. Launched in June 2018.
OPay is designed to make financial services more accessible to everyday customers –– whether it’s for the bills they have to pay, or the transfer & withdrawal of money; OPay is a platform that truly serves its users in the most convenient way.
Making Financial Services More Accessible For You, OPay gives you the freedom to make quick and easy payments, earn money, spend smart, and save more.
With OPay you can:
- Pay Your Utility Bills: Make your payments from the comfort of your homes or on-the-go. Pay for your cable TV, electricity, water, education, toll, tax, and more.
- Fast & Secure Transfer: With OPay, you can send money to other banks for free and receive money in real-time. All you need is a phone number to open an account.
- Connect with Friends: Chat with family and friends on the app. Send money to them with zero charges through our wallet-to-wallet payment system.Offline Banking
- USSD: No smartphone? Their USSD service is here to help you. You can diall *955# on your phone to carry out any transaction.
- Savings: Start saving smartly with any of their savings products and get up to 10% interest returns per annum. Withdraw your money at your convenience.
Since its Series A funding in 2019, OPay tripled its active agents to over 140,000 and saw daily transaction volumes doubling to exceed $10 million per day. Today, the company has spread its services across all 36 states in Nigeria with over 300,000 mobile money merchants. Furthering the company’s position as the largest mobile transaction provider in the country.
Till date, OPay has received a disclosed funding amount up to $170M. The FinTech company is rumoured to be raising a $400 million funding to join the list of unicorns in Africa.
7. Remita (SystemSpecs)
Remita set the pace for Fintech companies in Nigeria as it was developed by system specs in 1991 by John Obaro. It assists SMEs, multinationals, state governments, government agencies, NGOs, educational institutions and individuals to receive and make payments electronically.
SystemSpecs is one of the leading and oldest Fintech companies in Nigeria and is the owner of Remita, an API service that offers payment solutions in and outside the country.
Remita has been voted a couple of times as Nigeria’s Software of the Year. It has indeed set the pace for many Nigerian FinTech companies.Remita has been licensed by the Federal Government of Nigeria and serves as the Federal Government Treasury Single Account (TSA) backbone. With time, this company has progressed to one that sells software to organisations.
Remita focused on being an API service offering different solutions including fast loan products for lenders. It launched its mobile app in 2017.
Currently, Remita serves over 1,000 merchants, SMEs and organizations and is used by over 500 microfinance banks. It processes over $30 billion in transactions yearly.
Asides Remita, another big project launched by SystemSpecs is Paylink. Paylink was launched in 2020 as an instant payment solution that enables users to get funds directly into their bank accounts without having to expose their bank details
Carbon, formerly known as Paylater, is owned by One Finance and was founded in 2016 by Chijioke Dozie Co-founder & CEO, Ngozi Dozie Co-founder & Managing Director.
The company make use of mobile phones to acquire loans very faster, easier and without collaterals, eliminating the hassles that comes with getting loans from the traditional banks
Another amazing thing is that the Carbon app is quick, simple to use, well designed and works efficiently. Here you can borrow money instantly irrespective of your location in the country. You can also get a loan on the app without a guarantor or collateral.
These two (a guarantor and collateral) are some of the things Nigerian banks request when considering granting an individual a loan.
Carbon also has a feature called Payvest that allows users to save.
In 2019, Carbon obtained a $5 million loan from Lendable. After that, it acquired Amplify Pay which made it easier for the Fintech company to introduce novel banking features. As of 2019, this top Nigerian Fintech company had already generated a revenue of up to $10.4 million and have disbursed not less than $35 million in loans.
Carbon received an award as the Best FinTech Solution in Africa at the AppsAfrica Awards and has continued to stay on board as one of the top Fintech companies in Nigeria.
9. Interswitch (Quickteller)
Interswitch is the parent company of Quickteller an easy-to-use, multi-channel payments platform designed to make payments an easy and enjoyable experience.
Interswitch is one of the oldest Nigerian Fintech Companies. It was founded in 2002 by Mitchell Elegbe as an electronic payments processing and transaction switching company to provide online payment gateways and solutions.
Interswitch currently has:
- 8,000+ Billers aggregated on the Quickteller platform
- 26,600+ Quickteller Paypoint agents enabled across Nigeria
- 190,000+ Active businesses transacting daily
- 22,000,000+ Cards activated on the Verve network.
With Interswitch (Quickteller):
Bill payments: Entertainment and data subscriptions, electricity bills, government dues and levies, airtime and cable Tv- whatever it is, discover the easiest and quickest way to pay bills.
Flight booking: From cost-effective flight options to smooth payment experience, our flight booking service is the easiest way to travel anywhere.
Event tickets: Get verified tickets to the most exclusive and anticipated event without any stress.
Global online shopping: Shop directly from over 100 leading US/UK stores, pay in Naira and enjoy doorstep delivery to your Nigerian address.
As of May 2019, Interswitch revealed that it was processing over 500 million transactions in a month. The same year, the company acquired a 60% stake in eClat, which is a health technology company.
Interswitch also owns Retailpay, verve debit card, Smartgov and numerous automated teller machines (ATMs) across the country.
In November 2019, Visa invested $200 million and will recoup a 20 per cent stake from the company which is valued at no less than $1 billion making Interswitch one of the three unicorns in Africa.
E-tranzact is another foremost Nigerian Fintech company that offers solutions to payment problems. It is also one of the top performing FinTech companies in Nigeria. The company also offers a solution to payment issues in Nigeria as it has enabled businesses to accept payments online.
E-transact was founded in 2003 by founder and CEO Niyi Toluwalope who also owns many other financial technology startups like Mobile Top-up, PocketMoni, CorporatePay, BankIT and ATM CardlexCash among others.
E-tranzact has processed payment requests from different channels such as ATM, POS, Web, and transactions that utilize mobile automation. It supports networks like VISA, AMEX and MasterCard.
In 2018, the company experienced a major scandal that comes with serious scrutiny and backlash when one of the company’s platforms was reported to have been involved in an N11 billion fraud. For this reason, CBN ordered the immediate removal of some major directors of the company including the then CEO, Valentin Obi.
This scandal damaged the company’s public image and reputation as it recorded a loss of N3.1 billion in 2018. However, the following year, the company came back to life as it reported a profit of N96 million after tax.
e-tranzact processes N30 trillion worth of transactions from 400 million transactions in 2018. This is in spite of the bearish market and constant spate of regulatory sanctions.
Today Etranzact is rated as one of the top 10 FinTech companies in Nigeria In 2019, it received the award for the Best Corporate Turnaround and Transformation at the Business Day Top 25 CEOs and Next Bulls Awards.
Aside from Nigeria, E-tranzact operates in other African countries such as Kenya, Ghana, Zimbabwe and Cote d’Ivoire. It also operates in the United Kingdom.
How are FinTechs are Regulated in Nigeria?
FinTechs in Nigeria are regulated by the following regulatory and compliance bodies in Nigeria:
The Central Bank of Nigeria (CBN), the Nigerian Deposit Insurance Corporation (NDIC), Security and Exchange Commissions (SEC), National Insurance Commission (NAICOM), Nigerian Communication Commission (NCC) and National Information Technology Development Agency (NITDA)
The CBN: The primary role of the CBN is to regulate all financial services in Nigeria and all Financial institutions by virtue of the Banks and other Financial Institutions Act, 1991 (“BOFIA”). Before fintech companies offer financial services to consumers, they must obtain necessary licences and comply with the CBN’s applicable guidelines.
NDIC: The NDIC is responsible for insuring all deposit liabilities of licensed banks and other deposit-receiving financial institutions in Nigeria. Fintech companies which are in the business of obtaining and saving money deposited by consumers such as PSBs must be registered with the NDIC, pursuant to section 15 of the NDIC Act, 2006.
The SEC: The SEC regulates Fintech companies that have the intention of raising capital from the capital market and are mandated to register their securities with the SEC and comply with the ISA, 2007 and the rules made thereunder.
The CAC: It regulates the incorporation of and official record keeping for companies in Nigeria. Fintech companies (including banks) must be incorporated at the CAC to carry on business in Nigeria . This is a preliminary requirements for all businesses in Nigeria.
The NCC: Empowered by the Nigerian Communications Act, 2003 to regulate the telecommunication industry in Nigeria. Fintech companies offer services that involve the use of mobile phones, and must obtain operating licences from the NCC. For companies that perform mobile payments, they must be licensed by the NCC pursuant to the Licence Framework for Value Added Service (“VAS”).
The NITDA: is saddled with creating and enforcing data protection regulations in Nigeria as enshrined in the NITDA Act 2007. NITDA issued the Nigerian Data Protection Regulations 2019, protects rights of natural persons to data privacy and fosters the safe conduct of transactions involving the exchange of personal data.
NAICOM: was established by the National Insurance Commission Act, 1997. It is responsible for ensuring the administration, regulation and control of insurance business in Nigeria.
The FCCPC: was established by the Federal Competition and Consumer Protection Act (“FCCPA”). The provisions extend to Fintech and prohibit anti-competitive practices in the Fintech space.
Amount For Licencing Fintech Companies in Nigeria
In a publication on the CBN website, titled New License Requirements for the Payments System, the CBN released the financial requirements to have a Fintech company in Nigeria.
To get licenced as a Fintech company in Nigeria either as a super agent, payment solution service provider or as a mobile money operator you would need between ₦50 million to ₦2 billion capital requirements fee, with a non-refundable application fee of ₦100,000 and a licencing fee of ₦1 million naira.
The FinTech industry in Nigeria is a promising one and is still booming. This list of the top 10 most powerful FinTech companies only covers a small fraction of the FinTech companies and startups currently operating in the country.These companies have been able to harness the technological opportunities in the financial service industry; however, there are still many available opportunities and new areas to explore in the industry.
According to a World Bank reports, only about 40% of adults in Nigeria have bank accounts. There are still alot of Nigerians that do not have access to digital banking system, there are still many areas the traditional banks have failed their customers that FinTechs can come into, in order to make financial services more reliable, easy and less stressful.Tags: Carbon, E-tranzact, Fintech, Fintech companies, Fintech companies in Nigeria, Fintech in Nigeria, flutterwave, Interswitch, Kuda bank, Opay, Paga, Paystack, PiggyVest, Top fintech companies 2021