From newcomer to key player: Zone’s steady ascent in Nigeria’s payment landscape

Zone’s entry into Nigeria’s payment ecosystem introduced a revolutionary concept: a blockchain-powered payment infrastructure designed specifically for financial institutions. In 2022, the company secured a switching and processing license from the Central Bank of Nigeria (CBN), making its solution Africa’s first regulated blockchain network for payments.

Amid a regulatory environment often sceptical of blockchain, Zone’s strategy aligned closely with local regulations, gaining the trust of major financial institutions. The company’s first proof of concept, an ATM switching use case, was widely endorsed by prominent institutions such as Zenith Bank and UBA, who were among the first to adopt the service.

Building on this foundation, Zone recently launched its decentralised POS Payment Gateway. This innovative solution leverages the company’s blockchain-powered infrastructure to address longstanding issues in POS payment processing, such as transaction failures, chargebacks, and chargeback fraud. Additionally, Zone entered a strategic partnership with the Nigeria Inter-Bank Settlement System (NIBSS), which allows NIBSS to perform Payment Terminal Service Aggregator (PTSA) functions directly on Zone’s network.

This partnership integrates NIBSS’s oversight capabilities with Zone’s decentralised framework, streamlining compliance for POS providers while ensuring a seamless payment experience for financial institutions, merchants, and consumers.

By aligning with regulators and banking giants, Zone effectively positioned itself as a trustworthy, forward-thinking partner in Nigeria’s financial services industry.

Challenges to Zone’s ascent in Nigeria’s payment landscape

One of Zone’s initial challenges was crafting a blockchain solution that could satisfy Nigeria’s regulatory requirements without compromising its decentralised potential. Given the prevalent scepticism towards blockchain due to its association with unregulated solutions, Zone strategically adopted a semi-decentralised structure, blending regulatory oversight with blockchain’s transparency and efficiency.

Obi Emetarom, as CEO, shared in an interview with Techpoint Africa, “We began with a somewhat centralised approach to meet regulatory expectations, yet the architecture is designed to support decentralised expansion as we move forward.”

This innovative balance has allowed Zone to build a solution that remains both compliant and forward-thinking. Although this approach gave Zone credibility, Emetarom still sees the potential for Zone to become fully decentralised in the future.

Securing the commitment of Nigeria’s leading financial institutions presented another challenge. For a payment network like Zone, credibility and strength come from a robust base of network participants; however, getting banks, fintechs, and other financial institutions to join required overcoming the classic “chicken-and-egg” dilemma. Banks were hesitant to adopt a new blockchain network without seeing other major players involved.

Zone’s approach to this hurdle involved persistent engagement, showcasing its commitment to regulatory compliance, security, and interoperability. Over time, these efforts helped Zone build the trust needed to bring prominent banks and financial institutions onto its platforms, ultimately strengthening its network.

Overcoming this hurdle required strategic engagements that demonstrated Zone’s commitment to security, compliance, and interoperability, which gradually built trust within the financial services industry.

Bridging the perception gap between traditional finance and regulated blockchain-based companies was perhaps Zone’s most subtle, yet critical, challenge. Though fully compliant and partially decentralized, Zone had to distinguish itself from the speculative side of blockchain which often raises regulatory concerns.

By positioning itself as a decentralised yet regulated payment network with an innovative and grounded approach, Zone gained the confidence of Nigeria’s top financial institutions and demonstrated that regulated blockchain technology could serve as a reliable partner within a traditional financial framework.

Zone’s resilience and innovation have led to several industry-first achievements in Nigeria’s payment landscape. One standout accomplishment is the launch of Zone’s decentralised Point-of-Sale (POS) payment gateway—a pioneering solution that allows financial institutions on Zone to process POS-based transactions using its decentralised network.

By offering direct card routing, eliminating chargebacks, and enabling same-day settlements, the gateway delivers unprecedented efficiency and reliability.

With its innovative, regulated blockchain network, Zone has created a pathway for blockchain technology within Nigeria’s established financial system. As more banks and institutions join the network, Zone’s approach could redefine what’s possible for digital payments in Nigeria—paving the way for a more resilient, inclusive financial ecosystem.

Dada is a tech expert in Lagos.