ADVERTISEMENT
TechEconomy
Thursday, June 5, 2025
No Result
View All Result
  • News
  • Tech
    • DisruptiveTECH
    • ConsumerTech
      • Accessories
      • Phones
      • Laptop
      • Gadgets and Appliances
      • Apps
    • How To
    • TechTAINMENT
  • Business
    • Telecoms
      • Broadband
    • Mobility
    • Environment
    • Travel
    • Commerce
    • StartUPs
    • TE Insights
    • Security
  • Partners
  • Economy
    • Finance
    • Fintech
    • Digital Assets
    • Personal Finance
    • Insurance
  • Features
    • IndustryINFLUENCERS
    • Guest Writer
    • Appointment
    • EventDIARY
    • Editorial
  • Apply
  • TecheconomyTV
  • Techeconomy Events
  • BusinesSENSE For SMEs
  • TBS
  • News
  • Tech
    • DisruptiveTECH
    • ConsumerTech
      • Accessories
      • Phones
      • Laptop
      • Gadgets and Appliances
      • Apps
    • How To
    • TechTAINMENT
  • Business
    • Telecoms
      • Broadband
    • Mobility
    • Environment
    • Travel
    • Commerce
    • StartUPs
    • TE Insights
    • Security
  • Partners
  • Economy
    • Finance
    • Fintech
    • Digital Assets
    • Personal Finance
    • Insurance
  • Features
    • IndustryINFLUENCERS
    • Guest Writer
    • Appointment
    • EventDIARY
    • Editorial
  • Apply
  • TecheconomyTV
  • Techeconomy Events
  • BusinesSENSE For SMEs
  • TBS
No Result
View All Result
Tech | Business | Economy
No Result
View All Result
Podcast

Home » Navigating the High Seas of Approval Fees: A Closer Look at Fintech Startups in Nigeria

Navigating the High Seas of Approval Fees: A Closer Look at Fintech Startups in Nigeria

Joel Nwankwo by Joel Nwankwo
December 12, 2023
in Finance
0
fintech startups

RelatedPosts

Hot money in Nigeria - Naira | official market

Naira Strengthens Further in Official Market, Closes at N1,565/$1

June 5, 2025

Naira Appreciates to N1,579/$1 as Market Confidence Grows

June 4, 2025

In response to a recent mandate by the Nigeria Interbank Settlement System Plc (NIBSS), Nigerian banks are required to disengage non-deposit-taking financial entities, such as Switching Companies (Switches), Payment Solution Service Providers (PSSPs), and Super Agents (SAs), from their Nigerian Interbank Payment (NIP) outward fund transfer channels.

These entities play a vital role in the country’s digital financial ecosystem, facilitating transactions across various platforms, including USSD, mobile banking apps, POS systems, ATMs, and online banking services.

The directive, which aligns with CBN guidelines from February 2014, prohibits these entities from being listed as beneficiary institutions on NIP funds transfer channels.

The circular from NIBSS clarifies that while switches, PSSPs, and SAs may process outward transfers as inflows to banks, they are not authorized to receive inflows as their licenses do not permit them to hold customers’ funds.

This regulatory move highlights the framework within which Nigerian fintechs operate and the expected compliance regarding their licensed financial activities. Consequently, affected fintech platforms without banking licenses will be removed from the fund transfer channels of banks, impacting small business owners who frequently use these platforms for financial transactions.

To navigate these changes, fintech companies are anticipated to expedite actions to obtain banking licenses, ensure legal management of customer funds, and sustain their operations.

The Burden of Approval Fees on Fintech Startups

In the dynamic landscape of Nigerian fintech, the journey from ideation to implementation is often marked by a significant hurdle: approval fees. Fintech startups seeking to operate in Nigeria must navigate a complex web of regulatory requirements, and this journey is not without its costs.

Approval fees for licenses have become a substantial financial burden on these innovative ventures. From securing licenses to operating as payment service providers, mobile money operators, or digital banks, the spectrum of regulatory approvals comes at a price.

Fintech startups are required to allocate substantial resources to cover these fees, ranging from application charges to annual renewal costs. The financial commitment at this stage presents a considerable challenge for many startups, particularly those in their early stages.

Ever wondered what it takes to dive into the fintech world in Nigeria? Brace yourself for a read-worthy ride through the licensing processes.

The Big Shorts (Switching and Processing and Mobile Money Operators)

First off, you need to register your company with the Corporate Affairs Commission—no biggie, right? But wait, the minimum share capital is a whopping ₦2 billion! It’s like trying to find spare change in the sofa cushions.

Now, onto the application to the Central Bank of Nigeria (CBN). Just toss in ₦100,000 as the application fee, because, you know, licensing your fintech empire should come with a touch of financial humor. And guess what? The licensing fee is a cool ₦1 million; it’s almost like they’re saying, “Welcome to the exclusive club of fintech extraordinaires; here’s your bill!”

Let’s switch gears to mobile money operators. Want to join the fun? Register with the Corporate Affairs Commission and prepare to cough up ₦2 billion as your minimum share capital.

Application to the CBN? Just another comedic act. Toss in ₦100,000 as the application fee, because why not add a sprinkle of hilarity to your fintech journey? Oh, and the licensing fee? A hilarious ₦1 million.

The Small Shorts [Payment Terminal Services Providers (PTSPs), Payment Solution Service Providers (PSSP), and Super Agents]

Now, enter the realm of PTSPs—fintech wizards of POS terminal deployment. To play in this peculiar field, you’ll need to register your company and embrace a minimum share capital of ₦100 million.

Applying to the CBN? Just another whimsical escapade. Slap ₦100,000 on the table as your application fee. And the licensing fee? A quirky ₦1 million—because getting in on fintech is all about the unexpected punchlines.

Ready for a web of financial comedy? PSSPs, the fund collectors on the web, are the headliners. Register your company, flash a ₦100 million minimum share capital, and send in your application to the CBN. There is also an application fee of ₦100,000 and a licensing fee of ₦1 million.

Last but not least, super agents – the recruiters and supervisors of financially excluded agents. Register your company, showcase a ₦50 million minimum share capital, and hit up the CBN with your application. There is also an application fee of ₦100,000 and a licensing fee of ₦1 million.

If you’re diving into the world of financial technology, you must ensure you do it with a smile!

Ripple Effects on the Fintech Ecosystem in Nigeria

The repercussions of high approval fees resonate throughout the fintech sector, influencing both overall growth and the behavior of founders.

First off, only a handful of fintech startups will be able to complete the clearance procedure due to the barrier to entry created by these payments. This could potentially stifle creativity because of the possibility that financially strapped ideas would never be realized.

Furthermore, founders’ financial strain frequently compels them to look for outside capital, which affects their strategic choices and can potentially lessen their influence over the firm.

In addition, the cost of approval fees makes Nigerian fintech founders more circumspect. When faced with the significant financial outlay necessary for licenses, founders could choose safer, tried-and-true models in an attempt to get a faster return on investment. This conservative approach may unintentionally inhibit inventiveness and decelerate the rate of industry transformation.

In essence, the high approval fees create a delicate balance between regulatory compliance and fostering a vibrant and innovative fintech ecosystem in Nigeria. As stakeholders evaluate the regulatory landscape, finding a sustainable balance becomes paramount for the continued growth and dynamism of the fintech sector in the country.

 

Loading

Advertisements
MTN ADS

Author

  • Joel Nwankwo
    Joel Nwankwo

    Joel Nwankwo is a tech journalist. He is passionate about telling stories as it relates to Africa's social and financial tech advancements. You can reach him at joel.nwankwo@techeconomy.ng

    View all posts
0Shares
Previous Post

MTN Nigeria says Award of Tower Contract to ATC for 2,500 Sites is Final

Next Post

Boost for the Fight Human Traffic as QNET Announces ‘Say No’ Campaign

Joel Nwankwo

Joel Nwankwo

Joel Nwankwo is a tech journalist. He is passionate about telling stories as it relates to Africa's social and financial tech advancements. You can reach him at joel.nwankwo@techeconomy.ng

Related Posts

Hot money in Nigeria - Naira | official market
Finance

Naira Strengthens Further in Official Market, Closes at N1,565/$1

by Peter Oluka
June 5, 2025
0

The naira continued to strengthen in the official market on Wednesday, closing at N1,565/$1, a 0.89% appreciation from the previous...

Read more
Naira vs Dollar | Asset management

Naira Appreciates to N1,579/$1 as Market Confidence Grows

June 4, 2025
Tony Elumelu, chairman of UBA

Tony Elumelu Buys N43.9bn Worth of UBA Shares to Boost Stake

June 3, 2025
NairaWatch, Naira and dollar

Naira Appreciates, Closes at N1,582/$1 in Official Market

June 3, 2025
Agentforce for financial services by Salesforce

Salesforce Introduces Agentforce for Financial Services to Address Shrinking Workforces

June 2, 2025
Segun Alebiosu, CEO, FirstBank China-Africa Interbank Association | FirstBank Agent Credit

FirstBank Disburses N1billion in One Day via Agent Credit Scheme

June 2, 2025
Next Post
QNET | Transblue

Boost for the Fight Human Traffic as QNET Announces ‘Say No’ Campaign

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

I agree to the Terms & Conditions and Privacy Policy.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Techeconomy Podcast

Techeconomy Podcast
Techeconomy Podcast

Infowave is brought to you by TechEconomy. Every week we will bring new stories from startups and influencers who are shaping and changing the world we live in. We’ll also bring you reports on topics you should know.

Follow us @techeconomyng for more.

TECH TALK EPISODE 2
byTecheconomy

PRODUCTIVITY AND WORK-Life Balance

TECH TALK EPISODE 2
TECH TALK EPISODE 2
May 22, 2025
Techeconomy
CYBERSECURITY ESSENTIALS
April 24, 2025
Techeconomy
Digital Marketing Trends and strategies for 2025 and beyond
February 27, 2025
Techeconomy
Major Lesson for Techies in 2024 and Projections for 2025
December 6, 2024
Techeconomy
Major Lessons for Techies in an AI-Driven World | Techeconomy Business Series Highlights
November 26, 2024
Techeconomy
Maximizing Profitability Through Seasonal Sales: Strategies For Success
November 8, 2024
Techeconomy
Techeconomy Business Series
October 15, 2024
Techeconomy
PRIVACY IN THE ERA OF AI: GETTING YOUR BUSINESS READY
May 30, 2024
Techeconomy
Unravel the Secrets of Marketing Everywhere All At Once with Isaac Akanni from Infobip | Infowave Podcast Episode 1
February 9, 2024
Techeconomy
The Role of Ed-tech in Life Long Learning and Continuous Education
October 19, 2023
Techeconomy
Search Results placeholder

WHAT IS TRENDING

https://www.youtube.com/watch?v=g_MCUwS2woc&list=PL6bbK-xx1KbIgX-IzYdqISXq1pUsuA4dz

Follow Us

  • About Us
  • Contact Us
  • Careers
  • Privacy Policy

© 2025 Techeconomy - Designed by Opimedia.

No Result
View All Result
  • News
  • Tech
    • DisruptiveTECH
    • ConsumerTech
      • Accessories
      • Phones
      • Laptop
      • Gadgets and Appliances
      • Apps
    • How To
    • TechTAINMENT
  • Business
    • Telecoms
      • Broadband
    • Mobility
    • Environment
    • Travel
    • Commerce
    • StartUPs
    • TE Insights
    • Security
  • Partners
  • Economy
    • Finance
    • Fintech
    • Digital Assets
    • Personal Finance
    • Insurance
  • Features
    • IndustryINFLUENCERS
    • Guest Writer
    • Appointment
    • EventDIARY
    • Editorial
  • Apply
  • TecheconomyTV
  • Techeconomy Events
  • BusinesSENSE For SMEs
  • TBS

© 2025 Techeconomy - Designed by Opimedia.

Translate »
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.