MTN Nigeria, the country’s leading telecommunications company, has reportedly applied for two additional licenses, as it looks to expand the capabilities of its Fintech subsidiary MoMo PSB.
In a bid to double down on its fintech growth, the company applied for a Payment Service Solutions Provider (PSSP) and Payment Terminal Service Provider (PTSP) licenses.
What these licenses mean
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• PSSP License: This license will empower MoMo PSB to process payments internally, reducing reliance on third-party providers. Additionally, it will enable the company to offer payment processing solutions to merchants and partners.
• PTSP License: With this license, MoMo PSB can deploy and manage Point-of-Sale (POS) terminals, providing services to over 302,000 merchants and agents, as well as 5.3 million users on its platform.
Acquiring these licenses will enable MoMo PSB to directly compete with established fintech players like Interswitch, Flutterwave, amongst others, in the payment processing space. Also, in the POS market, it will challenge leaders such as Moniepoint, Opay, and Palmpay.
Notably, MTN Nigeria’s strategic move of acquiring PSSP and PTSP licenses, challenges the traditional regulatory boundaries for PSBs, which have primarily been focused solely on providing basic financial services to the underserved and underbanked population.
With expanded capabilities, MoMo PSB can offer more sophisticated financial services, positioning itself as a formidable competitor in the Nigerian market. Also, by expanding its reach and offering a wider range of services, MoMo can contribute to greater financial inclusion in Nigeria. MTN Nigeria’s strategic move with its fintech subsidiary highlights the growing importance of digital finance in Nigeria and the potential for innovative business models to reshape the financial landscape.
Launched in Nigeria in 2022, MoMo has rapidly expanded since inception. The fintech recorded 4.2 million wallets in less than two months of its launch. Also, it currently has over 5 million people actively use the platform every month, of which more than 324,000 are merchants served through MoMoPay.
In its recent unaudited results for the third quarter of the month (Q3), which ended September 30th, 2024, MTN’s Fintech revenue grew by 18.0%, with an acceleration in Q3 (up 32.3%) with Xtratime contributing significantly to the growth.
In a bid to simplify cross-border transfers, it launched a new remittance service in October 2024, enabling customers in Nigeria to send and receive money across multiple African countries. With the launch of this service, MoMo PSB users can now send money to 13 African countries which include; Benin Republic, Cameroon, Congo Brazzaville, Côte d’Ivoire, Democratic Republic of Congo, Gambia, Liberia, Malawi, Rwanda, Sierra Leone, Togo, Uganda, and Zambia. Additionally, customers in Nigeria can receive funds from South Africa, Rwandá, Uganda, Zambia, the Democratic Republic of Congo, and Mauritius.
MTN Nigeria has noted that MoMo PSB is positioned to enable millions of unbanked and underserved Nigerians to access a wide range of financial service products with an expansive agent network and digitized partnership infrastructure. The company has set a target of building the largest and most valuable fintech platform in Nigeria with 30-40 million active MTN MoMo wallets by 2025.