MTN Finalizes Nigeria MoMo Fintech Arm Spinoff to Confront OPay and PalmPay

In a major move to reclaim its share of Africa’s most competitive digital finance market, MTN Group Ltd. is finalizing the corporate spinoff of its Nigerian financial technology operations.

The company is actively restructuring its MoMo Payment Service Bank (PSB) ecosystem into a standalone corporate entity, preparing the ground for Mastercard Inc. and other strategic global investors to acquire a minority stake of up to 30%.

Speaking at the company’s capital markets briefing, MTN Group CEO Ralph Mupita highlighted the strategic importance of the carve-out: “The separations are complex as we have to minimize value leakage. On fintech, we are open to minority shareholding all the way up to 30%; we are not driven by IPO timelines.”

The restructuring took a major leap forward following an annual general meeting where MTN Nigeria shareholders approved the transfer of major control over its fintech assets to MTN Group Fintech B.V. through a massive ₦152.06 billion capital allocation.

This move establishes a standalone valuation for its payment rails, freeing them from the regulatory constraints of its core telecommunications business.

Competitive pressure in Nigeria

MTN’s decision to aggressively restructure its financial framework comes after years of regulatory limitations. When the Central Bank of Nigeria (CBN) originally granted MTN its Payment Service Bank (PSB) framework, the strict license prohibited the telecom giant from engaging in direct credit lending, holding foreign exchange transfers, or processing cross-border remittances.

This regulatory bottleneck created a clear opening for agile, venture-backed players operating under flexible Microfinance Bank (MFB) and switching licenses—allowing OPay, PalmPay, and Moniepoint to rapidly capture dominant market shares across Nigeria’s retail commerce sectors.

“In Nigeria, MTN’s license didn’t allow for international remittance, lending and some payments,” said Dioum. “That allowed some nascent players with licenses such as OPay and PalmPay to pick up market share.”

Opportunities in Nigeria remain significant and MTN is in the process of augmenting its banking license in the country with more than 200 million people, he said, adding that the company will go live with its Alipay platform in the coming weeks.

The Alipay Alliance and the Multi-License Push

To dismantle this competitive disadvantage, MTN Fintech CEO Serigne Dioum confirmed that the group is aggressively “augmenting” its banking and transaction licenses with the CBN.

This expansion builds directly on MTN’s recent move to pay ₦200 million for specialized Payment Service Solutions Provider (PSSP) and Payment Terminal Service Provider (PTSP) operational tiers.

• The Chinese Tech Engine: MTN is partnering directly with Jack Ma’s Ant Group Co. to completely overhaul the MoMo digital ecosystem using Alipay’s core transaction technology. Scheduled to go live in the coming weeks, this digital upgrade will allow MoMo to process high-concurrency retail transactions at the same scale as OPay, while significantly reducing internal infrastructure processing costs.

• The Merchant POS Drive: By securing PTSP and PSSP clearance, MoMo can move past simple telco-wallet transfers and deploy its own physical Point of Sale (POS) terminals and online checkout gateways across its network of 302,000 active merchants. This setup positions MTN to compete directly with elite business banking processors like Moniepoint and Wema Bank, which currently leads the traditional banking index with an exceptional 12.00% net interest margin driven by its digital ALAT ecosystem.

• Balance Sheet Lending: Crucially, the license upgrade will allow MoMo to utilize its massive user savings float to extend micro-loans and consumer overdrafts straight against its balance sheet. This bridges a major gap for a young, tech-savvy population of over 200 million people who are increasingly using mobile wallets to replace traditional brick-and-mortar accounts.

Macro Impact: The Battle for Nigeria’s Digital Finance Market

Globally, MTN’s fintech engine processed a staggering $500 billion across 14 African markets last year, bringing in 28.8 billion rand ($1.7 billion) in high-margin fee revenue. By carving this asset out of its debt-heavy telecommunications business, MTN is presenting investors with a highly liquid, pure-play transaction vehicle.

• Siphoning Cheap Bank Deposits: MTN’s aggressive move to launch balance-sheet lending and merchant terminals will accelerate the retail liquidity shift away from traditional commercial lenders. Nigeria’s top banks are already feeling this squeeze, posting a sluggish 2.1% quarter-on-quarter deposit growth in Q1. Lenders like GTCO have seen their loan-to-deposit ratios drop to an all-time low of 24% to avoid private sector default risks, choosing instead to harvest safe, double-digit government treasury yields.

• As MTN MoMo begins deploying data-driven consumer lines backed by Mastercard’s global infrastructure, it will further drain the cheap retail current-and-savings-account (CASA) float that traditional tier-1 and tier-2 banks historically relied on to keep their funding costs low.

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