MOBILE MONEY SERVICES

The Fintech industry in Nigeria is a robust one, with many subsectors connected to the Fintech ecosystem. Startups in the industry are almost always specialised in terms of their operations. Here, we will focus on Mobile Money Services which is under the Payment subsector.

Fintech Subsectors

  • Payment Services
  • Lending Services
  • Asset Management
  • Insurance

Mobile Money Services (MMS)

Mobile Money Services (MMS) are delivered by Banks and licensed corporate organisations  known as the Mobile Money Operators (MMO). MMO offer services like Person-to-person remittances, mobile airtime purchases and utility and retail payments.

Models for Operating MMS

Bank Led: A Bank and/or its consortium being the lead initiators delivers banking services leveraging on mobile payment systems.

The lead initiator(s) are directly responsible to the Central Bank of Nigeria (CBN) for obtaining approvals. The Fintech Company can however, be a partner organization in this model, where it provides mobile payments software, application and other ancillary hardware. Examples of MMOs operating this model include GT Mobile Money and FirstMonie Mobile Money.

Non-Bank Led: Duly licensed Corporate organisations excluding Banks and Telecommunication Companies are allowed to deliver MMS to customers in this model. The responsibility of obtaining the  approval of the CBN is conferred on the Fintech Company as the lead initiator.  The Lead initiator in this model CANNOT be a Bank or a Telecommunications Company.

MMOs operating this model include eTranzact (Pocket Moni) and Paga (Pagatech).

The MMS Ecosystem

Regulators CBN and Nigerian Communications Commission (NCC) → Mobile Money Operators → Infrastructure providers (Telecommunication companies and Inter-settlement providers) →  Other Service Providers → Consumers

Regulatory Licences

  • A mobile Money Licence from the CBN.
  • A Value Added Services(VAS) License from the NCC is required where the services offered involves the provision of VAS.

Some Requirements for Obtaining the MMS Licence are

  • Certificate of Incorporation of the consortium/fintech company (“the Initiator”).
  • Memorandum of the initiator.
  • Shareholding structure of the initiator.
  • Curriculum Vitae of the Board and Management of the initiator.
  • Tax Clearance Certificate of the initiator.
  • Business Plan of the initiator.
  • Payment of non-refundable Application fee of N100,000.00.
  • Evidence of Shareholders’ Fund of N2 billion before the license is issued.