#10: Nigerian Fintech is Serving Two Masters
Plus, what’s driving GTCO’s massive revenue?
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Hello Builder 👋,
Beth here again.
It’s been an interesting month in the ecosystem. And by interesting, I mean slightly chaotic.
Between security breaches at major financial institutions, MTN quietly pausing its airtime lending service, and that brief moment when it looked like the Nigerian government had invested $75 million in Flutterwave, there’s been a lot to process.
Anyway, this is the tenth issue of Inside Fintech. If you’ve made it this far, you’re an OG — forward this to someone who should be keeping up too.
Today, I want to talk about something that doesn’t always make headlines, but quietly shapes how everything else works: regulatory overlap in Nigerian fintech.
“You cannot serve two masters.” We’ve all heard that before. But Nigerian fintech seems to be trying anyway.
The industry has grown quickly from about 138 companies in 2020 to over 500 in 2025. Growth like that is expected. But the more interesting thing is beneath the surface. In 2021, fintechs were grouped into 17 categories. By 2025, that number dropped to 12. It looks like simplification. But if you look closely, it’s convergence.
Payment companies are moving into lending. Crypto platforms are plugging into payment systems. Infrastructure players are building customer-facing products. Everyone is expanding. And once that starts, the idea of “this company does only one thing” disappears.
Now here’s where it gets tricky. Regulation is still built around those older, clearly defined categories. But fintechs are building across multiple layers of the system, while regulation still expects them to fit neatly into one box. So, you end up with a mismatch.
With this reality, there are two possibilities:
Expansion Within One Regulator
The first is when a fintech starts as one thing and expands into another within the same regulatory boundary. Think of a payment processor that moves into lending or starts holding customer funds. We’ve seen this with companies like Paystack and Flutterwave, which started with payments but expanded into adjacent financial services.
In cases like this, the transition is relatively straightforward because they are still dealing with the Central Bank of Nigeria. They may need additional licences, but they are still answering to the same regulator.
Building Across Multiple Regulators
The second lens is where things start to get messy. This is when a fintech expands across different regulatory territories entirely—where one product begins to touch payments, investments, and other adjacent functions at the same time. At that point, it’s no longer a one-regulator conversation. It’s no longer just: “What are you building?”. It becomes: “Who exactly regulates this?
Sometimes, the product doesn’t even change, yet multiple regulators become interested in it anyway. And that’s where it gets even more complicated. Because now, it’s not just the company crossing boundaries. The regulators are. Even though these platforms are primarily positioned as investment or asset-based products under the Securities and Exchange Commission Nigeria, the Central Bank of Nigeria has also started signaling interest through initiatives like its pilot supervision programme.
So even without the product fundamentally changing, the regulatory surface around it expands.
The Crypto Case Study (SEC vs CBN)
Let’s take crypto exchanges a step further.
On paper, it seems straightforward. Crypto assets are treated as investment instruments, so you would expect companies in this space to be regulated by the Securities and Exchange Commission Nigeria.
And that expectation is seen in policy. In early 2026, the SEC increased the minimum capital requirement for Virtual Asset Service Providers (VASPs) to ₦2 billion, doubling the earlier ₦1 billion proposal from 2024. This signals that the SEC is actively positioning itself as the primary regulator of digital asset platforms.
So far, only a few players like Busha and Quidax have received Approval-in-Principle under this framework. So from that lens, it looks clear: crypto falls under the SEC.
But that’s only one side of the story. Because in reality, crypto companies in Nigeria don’t operate in complete isolation from the traditional financial system. They still need to interact with the naira— users deposit in naira, convert to crypto, and eventually withdraw back into their bank accounts.
And the moment naira enters the picture, the Central Bank of Nigeria becomes relevant. Which is why the CBN has also started paying closer attention, as seen in its recent pilot supervision programme targeting select VASPs for regulatory oversight and intelligence.
So now, what you have is a single product sitting across two different regulatory lenses:
One focused on crypto as an asset
The other focused on the movement of money within the financial system
And that’s where the lines start to blur. Because, it’s no longer clear where one regulator’s responsibility ends—and where another begins.
Telco Airtime Lending Case Study — FCCPC vs NCC
Earlier this month, airtime lending services quietly paused after MTN Nigeria suspended Xtratime, followed shortly by Airtel Nigeria.
What happened?
The backstory
In 2025, the Federal Competition and Consumer Protection Commission introduced new rules for digital lending — targeting abusive loan apps, harassment, and opaque practices. They extended these rules into airtime and data lending, and introduced requirements that went beyond typical consumer protection including: mandatory intermediaries in lending structures, restrictions on exclusive partnerships, approval requirements for commercial agreements etc.
At the same time, telecom services like airtime lending already sit within the domain of the Nigerian Communications Commission. And that’s where things started to collide. The operators in these affected companies were left in a position where compliance is no longer a single-regulatory track decision.
The Big Take
If you ask me, I’ll say fintech isn’t breaking the rules. It’s exposing how outdated the rules are. For a long time, regulation assumed that financial services would stay neatly separated — payments here, lending there, banking somewhere else.
Today, payment companies lend. Crypto platforms integrate with payment systems. Infrastructure players move closer to the customer. The lines have blurred, and that’s not because companies are trying to bypass regulation, but the market now demands more integrated solutions.
The problem is, regulation hasn’t evolved at the same pace. Fintech is moving fast, and regulation has to catch up.
Tell Me I’m Wrong 👇🏽
What Does This Mean for Builders?
The real question is whether regulatory overlap is actually a problem or just a natural outcome of a fast-growing industry. On paper, multiple regulators can be a strength. In practice, it’s more complicated.
Here’s what it looks like:
More expertise, more coverage
Different regulators bring different perspectives, which can reduce blind spots.Blurred boundaries
In reality, those lines aren’t always clear, and that’s where ambiguity starts.Ambiguity becomes operational
This doesn’t stay theoretical. It shows up in how products are built, launched, and scaled.Regulation becomes dynamic
It’s no longer something you map once, as it evolves with your product.You’re not building for one regulator anymore
Multiple regulators can have jurisdiction over the same product at the same time, or at different stages.
Beth’s Corner
Let’s be honest. Fintech isn’t trying to bend the rules. It’s just building in a way the rules didn’t anticipate. And when that happens, it stops being about compliance alone.
Right now, the builders who win won’t just be the fastest, but those who understand where the rules end and where reality begins. Slowing down or learning the edges as you go, which works better?
Let’s Discuss 👇🏽
Quick Data Drop
Global financial sector cyberattacks rose from 864 in 2024 to 1,858 in 2025, a 115% increase
Nigeria is home to 506 fintech companies as of December 2025
Digital transactions in emerging markets rose from 55 per adult in 2017 to 251 per adult in 2024, showing an acceleration in payment system usage
Africa accounts for approximately 74% of global mobile money transaction volume, making it the world’s dominant mobile-first payments region
Kenya has 400,000+ mobile money agents, giving it one of the most extensive mobile money agent networks in Africa per capita
Get More Insights Like This 👇🏽
In Other News - Industry Updates
1. Flutterwave secured a Microfinance Banking License
Flutterwave recently obtained a microfinance banking license in Nigeria, and the way it was communicated triggered mixed reactions across the ecosystem.
Some argue the company should have been explicit that it is a microfinance banking license, to avoid confusion around scope and capabilities. Others believe it doesn’t really matter, that what counts is the strategic direction, not the technical classification.
Now I want to hear your thought. When fintechs secure regulated licenses, does precision in communication matter as much as the substance of expansion?
What do you think — does the distinction matter, or not? Tell me 👇🏽
2. NCC and CBN partner to tackle payment fraud
The National Communications Commission (NCC) and the Central Bank of Nigeria (CBN) have signed an MoU to strengthen coordination on payment fraud prevention and digital identity risk management.
As part of the agreement, two joint committees were established:
Payment Systems & Consumer Protection Commmittee
Telecommunications Identity Risk Management System (TIRMS) Committee
The collaboration is aimed at addressing rising fraud risks linked to telecom-financial intersections, particularly around identity-linked financial access and SIM-based fraud vectors.
3. GTCO’s fintech arm becomes its most profitable non-banking business
GTCO’s fintech subsidiary, HabariPay, emerged as its most profitable non-banking business in 2025.
Profit After Tax (PAT): ₦9.7 billion (2025)
Up from ₦3.8 billion (2024)
This places HabariPay ahead of other non-banking subsidiaries in GTCO’s portfolio, reflecting the growing commercial viability of embedded fintech operations within traditional banking groups.
Usually, bank-led fintech subsidiaries starts as experimental extensions, however, they are becoming material profit centers inside legacy financial institutions.
4. The Big Guys Got Hit
In the past few weeks, Sterling Bank and Remita have both been caught up in alleged data breach investigations, with regulators stepping in to assess the scope and risk to users. This was attributed to massive data exposure and system vulnerabilities across connected infrastructure, not just isolated systems.
If the big guys can get hit, then size isn’t a security advantage. If anything, the bigger you grow, the more exposed you become.
For fintech startups, the takeaway is simple: security isn’t optional — it has to be built into the system from day one.
Before I Go, Let’s Talk
Do you think fintech regulation is getting clearer or it has become more complicated?
Reply & Tell Me 👇🏽
Fintech Opportunities
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If you’re building something worth spotlighting, you can fill out the form here.
New articles in the African Fintech Library
Cyber Threats to the Financial Sector in Africa
https://buildersinfintech.com/afl/article/cyber-threats-to-the-financial-sector-in-africaThe AML Mandate Clock is Ticking
https://buildersinfintech.com/afl/article/the-aml-mandate-clock-is-ticking
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That’s All, Builder
There’s a lot to unpack from this month’s newsletter. Let’s talk and share our opinions in the comments. And if this newsletter made you think of the new CBN policies and Nigeria’s finance industry differently, tap the ❤️ and last more thing - Forward This to Someone in Fintech👇🏽: