Nigeria FinTech Landscape

This document describes the Nigeria FinTech landscape, approaching the analysis from a FinTech, regulatory, Investment and talent standpoint. This document serves as a snapshot of the key pillars of a FinTech ecosystem in a country and provides a good overall view of the state of FinTech at a glance. Nigeria presents vast opportunity for FinTech as 37% of the population is unbanked but the population is young (it is estimated that 62% of the population is under the age of 25), and well-connected (internet penetration is 50.2% and mobile penetration is 84%). The regulator, the Central Bank of Nigeria, has established a regulatory sandbox for FinTech and is continuously exploring how to keep up with innovation in the space. Key Findings: - The regulator is exploring ways to regulate FinTech in order to keep up with innovation in the space. - The government has multiple initiatives to support and encourage innovation for job creation. - Digital payments, mobile lending and personal finance are currently the most popular areas where FinTechs are operating in. - Some Nigerian fintechs are gaining worldwide attention of investors. Lagos-based payment company Paystack in August 2018 raised $80 million from Visa, Tencent, Stripe and Y Combinator. As of August 2018, Paystack had more than 17,000 live merchants (which includes Dominos, MTN, Taxify, and Lagos Internal Revenue Service). In July 2018, CowryWise, which helps Nigerians save and invest in government bonds, was selected to take part in the Silicon Valley-based Y Combinator accelerator. - Banks in Nigeria are also leveraging FinTech to improve customer experience. One of Nigeria's biggest banks, FirstBank, launched the FirstBank Digital Lab in July 2018, at the “Yabacon Valley,” Yaba, Lagos mainland. The lab is designed to serve as a platform for FirstBank to collaborate and advance with the rapidly evolving FinTech. - International investors are taking notice of the potential of Nigerian FinTech. For example, in August 2018, a UK government delegation, led by the UK prime minister, visited Nigeria to meet with entrepreneurs and forge connections with the African FinTech community. - The group included representatives from the Financial Conduct Authority, the London Stock Exchange Group and the Prime Minister’s Ambassador for FinTech as well as representatives from big financial service players. SMEs in Nigeria can receive funding from dedicated funds or take out loans at friendlier rates. - The Bank of Industry (BOI) provides funding to small business by offering customer friendly rates through the youth entrepreneurship support fund and the national youth service fund, with a focus on technology companies.Read less