In Nigeria, the largest economy of West Africa, nearly 70% of adults do not have bank account. Also, it has Africa’s largest mobile market with over 150 million subscribers that highlights nearly 80% of Nigerians own a mobile phone. Consequently, the developed telecom industry has paved way for financial inclusion in the country.
The improved mobile payment systems developed by leading banks have widened the banked population of Nigeria. However, mobile money has taken up slower in Nigeria as compared to Kenya, owing to a ‘bank-led’ model followed by Nigerian Central Bank (NCB). The NCB has allowed licensed banks to operate mobile money, whereas restricted telecommunication companies for providing the infrastructure required. Yet, in recent years, the mobile payment industry in Nigeria has evolved tremendously. With major players such as Quickteller and Paga still trying to catch up with penetration of mobile applications launched by banks, the Nigerian mobile payment market has been steadily witnessing new entrants into the market who are bringing innovative solutions to the mobile payments space. Y’ello, lets its subscriber to open a full bank account using a short code on their mobile phone. It has been developed as a collaboration between Diamond Bank and telecommunications firm MTN. The service launched earlier in the year 2015, gave its consumers the ability to use a range of features across the Nigerian banking system.
Also the year 2015 saw launch of PayAttitude, a mobile payment system formed as a result of collaboration of six banks – namely Access, First Bank, UBA, Zenith, Skye and Diamond. This chip and PIN tag-type contactless functionality with NFC (Near Field Communication) technology enabled point of sale (PoS) transactions to be processed when the PayAttitude-enabled mobile phone was tapped on the terminal.
The newer entrant in the ever growing Nigerian mobile payment industry is a fully encrypted mobile wallet app, Nairabox. Also termed as social digital wallet, Nairabox can be used to pay utility bills, airline tickets, buy airtime, pay for events and cinema tickets as well as donate for charities. It is aimed to fill the gaps such as downtime and other drawbacks associated with Point of Sale (POS) use. In addition to allowing users make in-store payments, Nairabox allows its users to pay for goods and services within the application. Also, the users of Nairabox can carry out report and analysis on their business and can track spending. Along with safety, Nairabox offers convenience in usage as downloading and signing up, adding funds and making payments for the purchased goods and services.
Going forward, PayNXT360 expects greater interoperability between telecom provider and bank networks to offer users improved mobile payment experience through innovation and collaboration while making mobile payments.