Daily Maverick
MTN is now on track to operate its mobile money platform in Nigeria, with the company having long-term ambitions of using its network and infrastructure to ultimately launch a full suite of banking services.
Over the past five years, MTN has had a love-hate relationship with Nigeria and its admonishing regulators.
In 2016, MTN paid a $1.6-billion fine (reduced from an initial $5.2-billion) for failing to disconnect about 5.1 million mobile subscribers as Nigerian authorities were cracking down on unregistered SIM cards in the country that could be used for nefarious purposes such as terrorist activity.
In 2020, MTN settled a long-standing tax dispute with Nigerian authorities relating to dividend repatriation in breach of foreign exchange rules, agreeing to pay a $53-million fine.
Nigerian authorities were accused of unfairly shaking down foreign companies and seeking to extract cash from them because the country’s oil-reliant economy was in the doldrums due to falling oil prices.
MTN could have exited Nigeria because of its agonies in the country but the telecommunications giant didn’t – opting to double down on its presence in the country. After all, exiting Nigeria won’t be easy for MTN as it is a big and lucrative market for the telecommunications giant, generating more than 30% of its revenues from its 68 million subscribers in the country.
MTN is now on track to operate its mobile money platform in Nigeria, with the company having long-term ambitions of using its network and infrastructure to launch a full suite of banking services — including cash transfers, taking deposits, offering insurance cover, and term loans to consumers. MTN would ultimately become a de facto bank.
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