Mobile money: Abuja central bank gives MTN Nigeria green light

South African telecom giant MTN Group will soon offer financial services to its 56 million mobile customers in Nigeria.

    MTN Nigeria Communications PLC debuted May 16 on the Nigerian Stock Exchange in Lagos [Temilade Adelaja/Reuters]
    MTN Nigeria Communications PLC debuted May 16 on the Nigerian Stock Exchange in Lagos [Temilade Adelaja/Reuters]

    A subsidiary of MTN Nigeria Communications PLC has been awarded a licence by the country's central bank in Abuja that would allow it to provide financial services, the telecoms firm said on Monday.

    Nigeria announced last year that it would allow telecom companies to provide banking services, aiming to give millions of Nigerians without bank accounts access to mobile money services - which have been successful elsewhere in Africa.

    South Africa's MTN Group, which owns a majority stake in MTN Nigeria, had said it would apply for a mobile banking licence in Nigeria and hoped to launch the service in 2019.

    In May, MTN Nigeria listed in Lagos with a two trillion naira ($6.54bn at the time) debut that turned it into the Nigerian Stock Exchange's second-largest stock by market value.

    MTN Nigeria stock price
    Africa's largest telecom company has traded as 'MTNN' since spring on the Nigerian Stock Exchange [Bloomberg]

    MTN Nigeria CEO Ferdi Moolman confirmed on Monday that the company's Yello Digital Financial Services Limited (YDFS) unit had been granted a "full super agent" licence by the Central Bank of Nigeria.

    "Through the network established by YDFS, MTN is in a position to broaden the availability of financial services for the underserved across the country," Moolman said. "This marks a very important first step in leveraging our infrastructure to scale our fintech initiatives."

    "We have also applied for a Payment Service Bank Licence, which will enable us in time to offer a broader and deeper range of financial services to those communities and we remain hopeful we will receive approval shortly," he said.

    MTN runs Nigeria's biggest mobile phone network, serving around 56 million people.

    The company, however, has some legal trouble in Nigeria, where the attorney general is demanding payment of an unpaid $2bn tax bill.  MNT Nigeria is expected to be back in court on the tax matter on October 29, 2019. 

    SOURCE: Reuters news agency