MTN targets Nigeria’s $236 billion credit gap with direct lending push

MTN Group, Africa’s largest telecommunications provider, plans to expand into direct lending across key African markets, including Nigeria. The company is seeking regulatory approvals that will allow its financial technology arm to offer a broader suite of credit services.

“We have expanded access to credit for more people, but we also want to move further up the lending value chain,” Serigne Dioum, chief executive of MTN Group Fintech, said at the company’s capital market event on Wednesday. “Where appropriate, we will seek licenses that allow us not only to facilitate loans but also to lend directly to customers and deploy our own balance sheet.”

The strategy underscores MTN’s plan to capture a larger share of Africa’s underserved credit market, where access to formal banking services remains low despite rising demand. According to a 2025 report by the National Credit Guarantee Company, nearly 80 percent of Nigerian micro, small, and medium enterprises lack access to formal credit. Concurrently, data from research firm Stears estimates the sector faces a $236 billion funding gap.

The challenge extends beyond Nigeria. According to Dioum, only 4 percent to 5 percent of adults across Africa currently have access to formal credit, leaving a vast market largely untapped by traditional financial institutions. Nigeria sits at the heart of MTN’s expansion plans, though executives note the opportunity is continental.

MTN Group Chief Executive Ralph Mupita said the company is pursuing additional licenses in Nigeria and other markets to deepen its financial services, though he declined to name the specific licenses. “We are pursuing additional licenses that will allow us to offer a broader suite of financial products and services to customers,” Mupita said. “Nigeria is a key market in this regard, but the opportunity extends across several of our markets.”

MTN targets Africa’s cash-to-digital shift

The expansion comes as MTN continues to build its fintech business, which has become one of the company’s fastest-growing divisions. In 2025, MTN Fintech generated approximately $2.8 billion in revenue, processed more than $500 billion in total transaction value, and handled over 23 billion individual transactions across its regional markets.

The company now serves more than 70 million active MoMo users, works with over 2 million merchants, and supports an agent network of more than 1.4 million people across Africa. For MTN, lending represents the next major avenue for revenue growth. The company already facilitates access to credit through partnerships in several markets.

According to Dioum, more than 1 million people access loans through MTN’s platforms every day, using them to finance small businesses, purchase inventory, or cover urgent expenses such as healthcare costs. However, moving from a facilitator role to becoming a direct lender could significantly increase profit margins while giving it greater control over consumer data.

The push aligns with the group’s broader assessment of Africa’s digital banking market. MTN estimates that the continent’s fintech revenue pool could expand as much as 13-fold over the next five years, driven by the steady shift away from cash. Despite rapid growth, more than 90 percent of retail transactions on the continent remain cash-based.

The cash dominance presents clear commercial opportunities not only in lending but also in daily payments and cross-border remittances. “Together, payments, remittances and lending will be the key drivers of fintech growth over the next five years,” Dioum said during his presentation to investors.

MTN seeks Nigeria fintech license separation

In Nigeria, MTN has already begun laying the groundwork for a broader financial services offering. In November 2024, MTN Nigeria applied for Payment Solution Service Provider and Payment Terminal Service Provider licenses through its fintech subsidiary, MoMo PSB. Mupita said on Wednesday the licensing process is still ongoing.

The regulatory filings reflect the company’s focus on lowering its operational fees. A payment solution service provider license would allow MoMo PSB to offer payment gateway services, merchant aggregation, and payment processing. Crucially, it would reduce MTN’s reliance on third-party payment processors, cutting transaction costs.

A Payment Terminal Service Provider license would allow MoMo PSB to deploy and service point-of-sale terminals, develop retail applications, and offer training to merchants and agents. Beyond product licensing, MTN is also awaiting regulatory approval for the structural separation of its fintech business in Nigeria.

Mupita said shareholders have already approved the corporate separation, with the process currently undergoing regulatory review by the Central Bank of Nigeria. “These separations are complex,” Mupita said. “In Nigeria, the structure is relatively novel, and regulators are carefully assessing it to ensure it is completed in the most tax-efficient manner possible.”

MTN, Ant International Upgrade MoMo Infrastructure

In parallel, MTN’s fintech arm entered into a strategic partnership with Ant International, a global digital payment and financial technology provider, to update its mobile money ecosystem. The partnership, which is expected to launch in Nigeria next quarter, will introduce an upgraded application platform designed to expand commercial digital services around MoMo.

By leveraging Ant International’s technology, MTN is evolving MoMo to enable stronger system integration through a mini-app platform, enhanced fraud prevention, and new engagement features for consumers and merchants. The partnership represents a practical step toward building a more secure and stable digital infrastructure for the telecom company.

“This partnership aligns with MTN Group’s strategy of leading digital solutions for Africa’s progress by leveraging scale, technology and strong global partnerships,” Mupita said. “It reflects our commitment to improving the consumer experience by delivering a more seamless, secure and intuitive MoMo platform that expands economic participation.”

Douglas Feagin, president of Ant International, said his company is working to support MTN’s corporate shifts. “By combining MTN’s deep market insight with our technology capabilities, we aim to help create a more inclusive, secure and scalable digital financial services environment that benefits both consumers and merchants in-country,” Feagin said.

Dioum added that the alliance marks an important step in the company’s broader corporate layout. “This partnership marks an important milestone in our ambition to help shape Africa’s digital financial future through our One Big Tech strategy,” Dioum said, highlighting the long-term goals of the telecommunications group.

The technology update is expected to improve the MoMo user experience in Nigeria by enabling faster transactions, improving system reliability, and allowing greater integration across retail services. Customers will gain access to an updated application that supports payments, savings, and value-added services within a single system.

Beyond improving everyday financial transactions, the initiative reinforces MTN Group Fintech’s focus on sub-Saharan Africa, which the industry group GSMA identifies as the world’s most active mobile money region. This operational shift positions MTN Group Fintech to capture future digital volume by delivering accessible, secure financial services across the continent.