MTN Nigeria has applied for Payment Service Solutions Provider and Payment Terminal Service Provider licenses for its fintech subsidiary, MoMo Payment Service Bank, signaling its deepening focus on digital payments in Nigeria.
With a PSSP license, MoMo PSB will be able to operate payment gateways, develop financial solutions, and provide services like merchant aggregation and payment collection. This move would allow MTN to process its own payments in-house, reducing its current dependence on external PSSPs and lowering transaction costs.
MoMo PSB would also be able to handle payment processing for merchants and partners, expanding its role in Nigeria’s payment ecosystem.
The PTSP license will allow MoMo PSB to deploy and service POS terminals, develop POS applications, and provide support and training to its growing network of merchants and agents. Currently, MoMo PSB has over 302,000 agents and merchants, and more than 5.3 million users.
These new licenses position MTN’s fintech arm to compete directly with established players like Interswitch and Flutterwave in payment processing, as well as Moniepoint, Opay, and Palmpay in the POS sector.
MTN’s other fintech subsidiary, Yello Digital Financial Services (YDFS), applied for the licenses on behalf of MoMo PSB, with the company confirming a ₦200 million payment in its Q3 2024 report to cover the licensing fees.
MTN initially launched YDFS in 2018 with a super-agent license, which enabled bill payments and person-to-person transfers but restricted customer deposits. In 2022, MTN introduced MoMo PSB, equipped with a Payment Service Bank (PSB) license, enabling airtime and data sales, bill payments, and money transfers.
However, the PSB license does not allow MoMo PSB to provide services like lending, foreign exchange, or insurance underwriting.
Obtaining a payment service provider license in Nigeria typically involves a ₦100,000 application fee and an additional ₦100 million fee upon final approval.
By the end of Q2 2024, MoMo PSB had recorded 5.5 million active digital wallets and a network of 302,800 agents and merchants, reflecting its rapid growth and strategic positioning within Nigeria’s fintech landscape.
