MTN Nigeria has submitted applications for Payment Service Solutions Provider (PSSP) and Payment Terminal Service Provider (PTSP) licenses 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 license, MoMo PSB could 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 license, 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.
Read also: MTN MoMo active wallets surge to 5.5m in Q2
MoMo PSB would use this license to support its existing user base, which includes over 302,000 merchants and agents and approximately 5.3 million users.
MoMo PSB would compete with players like Interswitch and Flutterwave in the payment processing industry with the license. In the PoS segment, it would compete directly 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. Under a super-agent license, YDFS provided limited services like bill payments and money transfers.
However, the restrictive nature of that license prevented YDFS from holding customer funds. In 2022, MTN rolled out MoMo PSB under a Payment Service Bank license, 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 licenses involves a reported N200 million payment, as detailed in the company’s third-quarter financial report for 2024. Under Nigerian regulations, the license application process involves an initial N100,000 fee, followed by a N100 million license 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 licenses, 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.
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