THE main winners in Nigeria’s banking sector after a botched currency overhaul are two Chinese-owned fintech apps.
Vendors and customers turned to upstarts OPay and PalmPay in recent weeks to send and receive money after a central bank edict to swap old banknotes for new ones, which was later overturned, created a shortage of cash in Africa’s biggest economy, says online news outlet Semafor. Traditional banks could not handle the surge in online transactions. As of March 24, the two apps were ranked first and second in a list of Nigeria’s most downloaded finance apps on Google’s Play Store compiled by analytics company SimilarWeb — above the apps of traditional banks.
OPay, owned by Chinese billionaire Yahui Zhou through his web browser company Opera, has become the main alternative to banks for money transfer and bill payments during the cash crunch, say industry observers. It comes three years after the company shut various services on its app, including motorcycle taxis and food delivery, that were part of an initial push to be a super app. Zhou made the call to focus OPay as a digital bank.
But that early super app push and a highly coveted payments licence from Nigeria’s central bank have positioned OPay as one of Nigeria’s leading financial services companies.
Opera increased its stake in OPay this year to 9.5 percent from 6 percent. It ultimately plans to sell its stake in the fintech startup. ‘OPay continued its strong growth trajectory through 2022, giving us comfort in the ultimate marketability of our increased ownership stake,’ Opera wrote in a US Securities and Exchange Commission filing in February.