Telecommunications giant, Airtel Africa Plc, on Friday said it has received an Approval-In-Principle for its subsidiary Smartcash Payment Service Bank Limited to operate a payment service bank business from the Central Bank of Nigeria (CBN).
Final approval, according to a statement on the Nigerian Exchange Limited platform by Simon O’Hara, the group company secretary, “is subject to the Group satisfying certain standard conditions within six months.”
Commenting on the approval, Segun Ogunsanya, Chief Executive of Airtel Africa, expressed pleasure at the approval granted to Smartcash, pledging the group’s readiness to work “closely with the Central Bank to meet all its conditions to receive the operating licence and commence operations.
“The final operating licence will enable us to expand our digital financial products and reach the millions of Nigerians that do not have access to traditional financial services,” he explained.
“I am looking forward to working closely with the government, the central bank and traditional financial institutions to expand financial inclusion and meet the evolving needs of our customers and the economy,“ he stressed.
The AIP for Airtel Africa to operate a PSB is coming two years after the company told investors and analysts at a group investor session in Lagos to discuss its numbers for the half-year ended September 30, 2019 that it had submitted an application and is expecting that the apex bank would grant the request to enable it launch its mobile money and super agent banking services in Nigeria “in the next couple of months, or early 2020.”
Airtel Money, the management had added, will be parallel supply side for the poor outside of the banking system, serving as a fintech company and bank for the unbanked, even as it said there is no need to worry that its competitors- Glo and 9mobile had been issued AIPs earlier.
The CBN had set a minimum capital base of N5bn for PSB licence, which according to analysts, “may limit the play field to only telecommunications companies, especially given that they are supposed to operate in the rural areas.”
Investdata also recalls that MTN Nigeria Communications Plc had in July 2019 obtained a full licence to distribute financial services across the country from the apex bank, through its subsidiary, Yello Digital Financial Services Limited (YDFS), which has been granted a full super-agent licence, for a launch of the group’s fintech strategy.
YDFS had in December 2018 received Approval in Principle for the service, after which it began conducting a pilot project preparatory to meeting the conditions for a full licence.
The super-agent licence, the statement noted, “enables us to extend access to financial services to a much broader group of Nigerians. This forms part of our commitment to contribute towards the achievement of Nigeria’s financial inclusion goals.”
