After the loss of 2.5 million active wallets in 2024, MoMo PSB, MTN Nigeria’s fintech arm, explained that the decline was part of a strategic shift to improve service penetration, enhance monetization, and reduce customer acquisition costs.
MTN and Airtel Africa’s entry into Nigeria’s payment service sector in 2022 was anticipated to disrupt traditional banks and fintech firms. However, the impact of both telecom giants has been more nuanced than initially expected.
MoMo PSB is among the five Payment Service Banks (PSBs) licensed by the Central Bank of Nigeria (CBN) between 2021 and 2022 to promote financial inclusion, especially in underserved areas. Despite limitations on revenue potential, PSBs like MoMo PSB aim to extend banking services to individuals and businesses beyond traditional banks’ reach.
PSBs have faced challenges in gaining market traction compared to fintech giants like Opay, Moniepoint, and Palmpay, who have attracted millions of users.
In Nigeria, mobile money adoption relies heavily on banking agents due to limited internet connectivity and low smartphone penetration, particularly in rural areas.
Despite setbacks, MoMo PSB has received substantial financial backing from MTN Nigeria to strengthen its digital banking infrastructure.
MoMo PSB’s active mobile money wallets experienced growth but later declined in 2024, prompting a shift in strategy towards digital banking.
MoMo PSB is diversifying its services by applying for additional licenses to handle payment gateways and provide merchant aggregation services, aiming to serve SMEs and individual customers better.
CEO Karl Toriola emphasized the company’s focus on user engagement and retention to reverse the decline in wallet usage and increase activity within the ecosystem.