MTN Nigeria has submitted applications for Payment Service Solutions Provider (PSSP) and Payment Terminal Service Provider (PTSP) licences for its fintech subsidiary, MoMo Payment Service Bank (MoMo PSB).
With this, MTN is expanding its impact in Nigeria’s digital payments sector, as it seeks to simplify its payment processing while competing with established financial platforms.
With the PSSP licence, MoMo PSB would be able to handle payment gateways, provide merchant aggregation services, and build other financial solutions.
This would also allow MTN to process its payments in-house, reducing dependency on external processors, and enabling it to meet the payment needs of third-party merchants and partners.
The PTSP licence, on the other hand, would allow MoMo PSB to deploy, manage, and service point-of-sale (PoS) terminals, thus bolstering its engagement with Nigeria’s growing network of small and medium-sized businesses.
Through this licence, MoMo PSB would support its existing user base, which includes over 302,000 merchants and agents, along with approximately 5.3 million users.
With the license, MoMo PSB would also gain higher competition among players such as Interswitch and Flutterwave in the payment processing industry.
In the PoS segment, it enters into direct competition with brands like Moniepoint, Opay, and Palmpay, aiming to establish a foothold in the market.
MTN’s fintech vision began with the launch of Yello Digital Financial Services (YDFS) in 2018, providing limited services like bill payments and money transfers under a super-agent licence.
However, the restrictive nature of that licence prevented YDFS from holding customer funds. In 2022, MTN rolled out MoMo PSB under a Payment Service Bank licence, expanding its services to include airtime sales, money transfers, and bill payments, though restrictions still limited MoMo PSB from offering lending or foreign currency transactions.
The telecom giant’s latest application for the PSSP and PTSP licences comes with a reported ₦200 million payment, as detailed in the company’s third-quarter financial report for 2024.
Under Nigerian regulations, the application process for these licences involves a ₦100,000 initial application fee, followed by a ₦100 million licence fee upon final approval.
As of the second quarter of 2024, MoMo PSB has amassed a user base of 5.5 million active wallets and established a network of 302,800 agents and merchants across Nigeria.
In pursuing these licences, MTN aims to strengthen its fintech subsidiary’s role in Nigeria’s financial industry, providing a greater range of payment services and boosting its competitive edge in the industry.
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