Nigerians now have more ways to send money and receive money internationally. The Central Bank of Nigeria (CBN) recently released the list of 60 firms approved as International Money Transfer Operators (IMTOs) to render international money transfer services. Pagatech Limited joins other notable FinTech firms on that list that also just got approval from the CBN to operate international money transfer services.
Pagatech is Nigeria’s leading mobile payments platform Tayo Oviosu founded in 2009. His mission, 10 years ago, was to enable universal access to financial services for Nigerians.
In Nigeria, Paga, its flagship service, boasts of about 1.6 million active users from a seeming base of 9 million.
According to an interview Oviosu granted to Forbes 8 years ago, “Our goal is to have 30,000 agents across Nigeria in five years and 15 million customers. If we achieve that we will bring financial services within reach of over 40 million Nigerians.”
Operating as an IMTO now means Pagatech is certain to scale these numbers even faster and realize its mission. Having raised a total of $34.7 million in funding over 4 rounds, this is a big step for Paga as it will enable it to raise even more funding.
This approval, according to the Central Bank of Nigeria, is in line with efforts to liberalize the foreign exchange market. It is also to ensure liquidity and make foreign exchange more readily available to consumers.
Other notable firms on the list include Moneygram, Western Union, Worldremit, PayPal, NIPOST, and other Nigerian FinTechs including Flutterwave, Interswitch, Venture Garden, Nairagram, and e-Tranzact.
IMTOs vs DMBs in Nigeria
The regulatory regime for international money transfer operators in Nigeria prohibits Deposit Money Banks (DMBs) from operating as IMTOs. These banks can, however, serve as agents to the operators.
Nigeria’s international remittance markets have grown significantly with major contributions to investments and commerce. Nigeria’s diaspora annual remittance of $21 billion, is so far, the largest in Africa.
Prior to liberalizing the IMTO market in 2002, Western Union and MoneyGram largely controlled the international money transfer market in Nigeria before 2008. These entities took advantage of exclusivity agreements which gave them an almost monopolistic grip over the market.
Paystack, another promising FinTech company is yet to get an IMTO license and may do so very soon.EN FR