Nigerians have been dumping traditional banks and resorting to the adoption of digital methods to make their transactions, such as Fintechs and mobile money operators, as the Naira crunch in the country continues to bite harder.
This is increasing the fear of banks who are starting to lose many customers due to their inability to dispense cash, non-availabilty of both the old and new naira notes, as well as their increasingly poor network services which has witnessed many customers complain of dispense error issues or multiple deductions from their accounts despite notification of failed transaction.
Recall that the Central Bank of Nigeria had redesign the N200, N500 and N1,000 notes and banned the old notes but later accepted only the old N200 notes. However, the banks claimed that the new notes were not made available to them, hence many of them had to shut down while other worked skeletally or closed operations much earlier than usual. Their digital payment platforms were also non-operational as most bans’ USSD transfers, automated teller machine (ATM) were unavailable while there were no over-the-counter (OTC) operations.
Few of the banks’ transfer channels like mobile transfers posed serious challenges for customers, as they transactions took several minutes, hours, days, or at all, hence many traders have started refusing to accept transactions through transfers to avoid the unnecessary delays.
These challenges have led to customers switching to Fintechs for better hitch free service of their transactions and lower charges. The following are popular digital banks Nigerians have started to embrace which has substantially increased the number of downloads of their apps:
- Paystack: One of the leading financial technology company in Nigeria was founded in 2015 by Shola Akinlade and Ezra Olubi. Online payments with their platform allows for smoother and easier transactions by customers who are able to receive payments using invoices and creating payment pages. Paystack accepts Visa cards, Verve cards or Mastercard from anywhere in the world. They have partnerships with Betway, MTN, IrokoTV, Domino and Taxify.
- Accelerex launched operations in 2013, and has been meeting customer demands in terms of fast and secure fintech products, solutions and services. Since 2019, they’ve maintained their position as the number one Payment Terminal Service Provider in the country in terms of the value of transactions processed. The platform supports 95% of Nigerian banks, with over 90,000 Merchants across the 36 states in the country. They’ve also expanded their operations to Ghana, Kenya, and DR Congo, and are planning to launch in other African countries by the end of the year. With the platform, small and medium-sized merchants are able to digitise their retail operations around inventory management, cashier management, and payment acceptance while giving them the power to remotely manage store operations and monitor the performance of each outlet.
- PiggyVest allows you save money at an interest rate higher than what traditional banks offer. While PiggyVest offers different saving plans, customers can also choose to go for the PiggyBank feature on the platform, which allows them automatically set the amount of money they want to save daily. The amount will automatically be deducted from your account every day and saved in PiggyVest until the set time for withdrawal, where you withdraw with the stipulated interest (current 8% p.a). PiggyVest also has a feature called Flex Dollar that allows you save in dollars, earn interest and transfer dollars to anyone on PiggyVest.
- Remita launched by John Obaro in 1991, was developed by SystemSpecs, and has won Nigeria’s Software of the Year several times. They help organisations make and receive payments electronically. They serve as the Federal Government Treasury Single Account (TSA) backbone. This company has progressed to one that sells software to organisations with time. Remita is used by over 500 microfinance banks. Remita also launched Paylink in 2020 as an instant payment solution that helps users get funds directly into their bank accounts without exposing their bank details.
- Kuda Bank very popular in Nigeria. Kuda Bank helps avoid the exorbitant charges by traditional banks and they don’t make use of the normal paper process as everything is carried out online. Customers can open their accounts online within minutes. They also offer customized Mastercard ATM cards with no transfer fees or ATM maintenance fees, while deposits are also free.
- Interswitch which was founded by Mitchell Elegbe and started as an electronic payments processing and transaction switching company in 2002, is a major name in Nigeria’s FinTech industry and one of the oldest in the country. They are the owners of Quickteller which provides online payment gateways and solutions, allowing online buyers significantly benefitting from their services. They also offer online consumer payment platforms, point-of-sale terminals, Verve and its ATM card. They are also the owners of Retailplay, Verve debit card, Smartgov and many automated teller machines (ATMs) across the country.
- Paylater, renamed Carbon, is owned by One Finance Limited and commenced operations in 2016. It is a loan app for Nigerians that offer loans to customers through its mobile app, thereby helping customers avoid the herculean task of getting loans from traditional banks. Papers, guarantor or collateral are not needed to get a loan on the platform unlike traditional banks, and their services are easily accessible from anywhere in the country.
- E-tranzact founded by Niyi Toluwalopeis in 2003, is also one of the oldest FinTech companies in Nigeria and one of the best FinTech companies in the country. They offer solution to payment issues in Nigeria, enabling businesses to accept payments online. They are the owners of financial service providers such as Mobile Topup, PocketMoni, CorporatePay, BankIT and ATM CardlexCash. E-transact processes payment requests from different channels such as ATM, POS, Web, and transactions that utilize mobile automation and supports networks like VISA, AMEX and MasterCard. They also operate in Kenya, Ghana, Zimbabwe, Cote d’Ivoire and the United Kingdom.
- Flutterwave: Founded in 2006 by Olugbenga Agboola and Iyinoluwa Aboyeji and is one of the most recognised FinTech companies in the country, as more customers continue to use their platform to send, receive money and pay bills. They are in collaboration with over 40 banks around Africa. Flutterwave also has a mobile app compatible with both Android and iOS. They has offices in Lagos, San Francisco and operates in 20 African countries.
- Paga founded by Tayo Oviosu in 2009, allows customers easily send and receive money in Nigeria. Despite being able to be used without internet connection, it is reliable and quick. It has partnership with Visa regarding payments and technology. Paga, have started expanding outside Nigeria started making moves to expand to other countries asides from Nigeria and already has an office in Mexico. It boasts of over 12 million users, with over 20,000 agents in different parts of the country.