Payment And Remittance Firms Lead Nigeria’s Fintech Sector – Report
Payment and remittance firms have emerged as the leading services in Nigeria’s fintech sector, holding over 30% of the market share, according to a recent report by finance-based research organization Agpaytech.
Agpaytech’s findings underscore Nigeria’s significant progress in real-time payments, ranking the country 6th in the ACI Worldwide league table for the most developed real-time payments markets. Nigeria recorded 7.9 billion transactions in 2023, with expectations to reach 19.7 billion by 2028.
The report also highlighted the substantial presence of lending and financing firms, which account for 20% of the market, following payment and remittance services. Blockchain technology firms, which are transforming industries with decentralized solutions, make up 13% of the market. Investech companies, offering innovative investment solutions, represent 9.5% of the sector.
Other segments include personal finance firms at 8%, business administration and insurtech at 3.5% each, regtech at 2.2%, and security and ID firms at 1.8%.
In 2023, Statista reported 217 fintech startups in Nigeria, marking a 50.6% increase from 144 startups in 2022. Agpaytech attributes the rise in fintech startups to factors such as increased internet penetration, a large unbanked and underbanked population, and growing consumer demand for digital financial services. Fintechs have expanded beyond traditional banking services to include non-financial services and have integrated robust payment systems into sectors such as transport, education, trade, SMEs, and utilities.
“The significant investment and partnerships from international and local players are enabling FinTech to offer instant, convenient, and accessible banking services,” the report stated.
Despite ongoing growth, Statista revealed that the average transaction value per user in Nigeria’s fintech segment is $2. The number of users is projected to reach 2.11 million by 2027, with user penetration expected to rise from 0.4% this year to 0.9% by 2027.
Fintech operators such as PalmPay have reported over 30 million users and 1.1 million businesses in their cashless payment ecosystem as of February. Similarly, OPay also boasts over 30 million users, sustaining the growth of digital payments in Nigeria.
Source: BusinessdayNG
