Tuesday, January 26, 2021
- Advertisement -

OPay targets North Africa after Nigeria success

OPay, a Nigerian , wants to expand its payments service operations to North Africa early next year after breakthrough in African largest economy.

Bloomberg reported on Wednesday that Opay’s success was on the back of the COVID-19 restrictions, which caused a spike in transactions on its platform.

The volume of monthly settlements on the OPay platform grew almost fourfold to $1.4 billion in November from $363 million in January, as people sought alternative payments services during coronavirus-induced lockdowns, the company’s managing director, Iniabasi Akpan, said in an interview from Lagos.

“We plan to reach transactions value of about $2 billion by the end of this year,” Akpan, who is also the country head, said. The company will leverage its network of 300,000 offline agents to deepen the adoption of its payments service, he said.

The company is now planning an entry into the north African market after its success in Africa’s most populous country, Akpan said. “The process has begun, and we will see how the first quarter turns out.”

The Lagos-based startup, which has shareholders including Softbank Group Corp. and China’s Meituan Dianping, said it attained financial self-sufficiency in June and still has enough cash in the bank to fund its expansion plans.

Previous plans to expand to South Africa and Kenya, after raising $190 million in funding last year, have been put on hold due to the disruption caused by the coronavirus pandemic. In February, OPay suspended part of its operations including the ride-hailing and the logistics businesses to focus on the payments business.

The financial service provider is currently piloting a digital overdraft product for its mobile wallet customers who have short-term funding needs. Users will be able to borrow from 5,000 to 100,000 naira and have a window of 30 days to repay. The overdraft attracts 3% interest for the first seven days and 1% every day after that.

Through the product, which is called CreditMe, “we will be lending to working-class people in their mid-20s and 30s, like students and small business owners, who have a source of income,” Akpan said. He expects to launch the credit platform in the first quarter subject to approval from the central bank.

Read more: Stripe Agrees to Buy Nigeria Startup Paystack for $200 Million

The mobile-payments company also acquired an international money transfer license last year and plans to partner with WorldRemit to process remittances into Nigeria. New regulations from the central bank are delaying the launch, Akpan said. The service will take off as soon as there is clarity on what operators are allowed to do, he said.

OPay currently processes about 80% of bank transfers among mobile money operators in Nigeria and 20% of the non-merchant point of sales transactions, Akpan said.

The company is currently exploring partnerships with firms that have complementary services, according to the Managing Director. “We have a large customer base of about seven million we can offer unique financial products.” (Bloomberg.com)

Copyright 2020 Business Live Nigeria. All rights reserved. This material, and other digital content on this website, may not be reproduced, published, broadcast, rewritten or redistributed in whole or in part without prior express written permission from Business Live or appropriate credit being given to businesslive.ng as the source.

Latest news

EFCC arraigns ‘Mama Boko Haram’ on fresh N41.7m fraud charges

The travails of Aisha Alkali Wakili alias Mama Boko Haram are yet over as the Economic and Financial Crimes Commission (EFCC) Maiduguri Zonal Office,...
- Advertisement -

Zenith Bank board meets to discuss results, final dividend

The Board of Directors of Zenith Bank Plc will meet on Thursday 28, 2021, to discuss the audited financial statements (AFS) for the year...

Pension industry fund assets rise to N12.29tr

The pension industry fund assets rose to N12.29 trillion by November 30, 2020. This represented a 1.94 per cent increase when compared with N12.053...

Nigerian stocks buck global downtrend with N552b gain

Nigerian equities played the contrarian amid global stock market decline as sustained bargain-hunting ahead of the earnings season roused Nigerian shares to a net...