Respect the banks because they have evolved in Nigeria. Yes, “in a resounding testament to its robust performance and growth trajectory, HabariPay, the fintech subsidiary of Guaranty Trust Holding Co Plc, announced a remarkable N2.3 billion profit before tax for the fiscal year 2023.” . Good People, the fintech unit of GTBank’s parent company, is a rainmaker of profit.
Amidst the intensifying competition in the fintech landscape, GTCo’s HabariPay witnessed astronomical growth in transaction volumes during the year under review. The value of transactions processed on the platform surged by an astounding 8,620%, reaching N12.1 billion from N139.3 million recorded in the preceding year. Additionally, HabariPay’s international payment transactions witnessed a remarkable increase from $175,927 in 2022 to $2.3 billion in 2023, signaling its emergence as a dynamic force in the financial technology sector.
According to GTCO, HabariPay’s rapid growth underscores its commitment to innovation and empowerment in the digital economy. The company’s core operations encompass a wide array of services, including a payment gateway facilitating transactions via virtual accounts, USSD, card, and bank transfer channels. Moreover, it engages in switching verticals, value-added services such as bill payments for airtime vending, and distribution of bulk SMS processed through licensed Value Added Service Aggregators authorized by the Nigerian Communications Commission (NCC).
Yes, Nigerian banks have an edge over fintechs in the Nigerian financial services sector right now. A few years ago, I postulated using the smiling curve (yes, a smiling face-like curve) where the vertical axis is Value and the horizontal axis is Positioning of companies, to explain what was happening. I noted then that fintechs in Nigeria were operating at the edges, and they were capturing a lot of value, while banks which were tethered at the center were only picking marginal value.
However, from 2021, Nigerian banks evolved, consolidating the center of the curve even as they inserted themselves at the edges of the curve. So, just like that, they built a moat at the center, even as they captured massive value at the edges, distorting the equilibrium at scale. Right now, banks have asymmetric advantages over fintech companies in Nigeria, and that is why their fintech subsidiaries are raining profits. You can read that piece again here – “Banking, Fintech And Smiling Curve: Why Where You Operate Is More Important Than Efforts You Put In ”
Tekedia Mini-MBA edition 16 (Feb 10 – May 3, 2025) opens registrations; register today for early bird discounts.
Tekedia AI in Business Masterclass opens registrations here.
Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.
It is about positioning and not necessarily the efforts you are putting in, because where you operate is more important than the efforts you are putting in. Today, Nigerian banks have locked both the center and the edges of the smiling curve, and that is why they’ve become super-profitable!
Respect the banks because they have evolved in Nigeria. Yes, "in a resounding testament to its robust performance and growth trajectory, HabariPay, the fintech subsidiary of Guaranty Trust Holding Co Plc, announced a remarkable N2.3 billion profit before tax for the fiscal year… pic.twitter.com/QtbtiN6QZd
— Ndubuisi Ekekwe (@ndekekwe) May 13, 2024
---
Register for Tekedia Mini-MBA (Feb 10 - May 3, 2025), and join Prof Ndubuisi Ekekwe and our global faculty; click here.