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  Nigeria’s FinTech industry has grown rapidly over the past decade. Starting out with just a handful of payments companies, it’s expanded on all fronts and now includes multiple segments, each with a large number of players. The space is populated by hundreds of startups, with many new ventures emerging every other year.
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There’s a lot more going on in Nigerian FinTech beyond the regular metrics of success—funding, scaling and profitability. This article takes a look at some interesting facts about the state of FinTech in the country as of the year 2022. There Are At Least 150 FinTech Startups In Nigeria It’s not clear how many FinTech startups there are in Nigeria. Statista, an international market data provider, puts the number at about 144. The EFInA (Enhancing Financial Inclusion and Access) says it’s anywhere between 210 and 250. Techpoint Intelligence reckons that it’s upwards of 270. But we can be certain of one thing—the FinTech scene is fluid and dynamic, with startups entering into and exiting from it on the regular. Nigeria Is Home To Three FinTech Unicorns Three FinTech unicorns (startups worth at least $1 billion) call Nigeria home. They are Interswitch, which achieved this status in 2019 after Visa took a 20% stake in it for $200 million; Flutterwave, founded in 2016 and currently valued at $3 billion; and Opay, a Chinese-backed company with a $2 billion valuation, which it attained following a $400 million Series C fundraise in 2021.
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FinTechs Were The Most Invested In Startups In 2021 According to the FinTech Association of Nigeria, FinTechs accounted for 63% of the $1.37 billion funding raised by Nigerian startups in 2021—obviously outstripping ventures from other tech-driven industries in the country. And between January and August 2022, local FinTechs have managed to secure $507 million in investments, despite a global slowdown in funding activity. The Industry Comprises Of Several Niches As has already been noted, the financial technology space includes several segments. They include payments, wealth management, digital assets, online lenders, InsurTech (insurance technology), neobanks, and digital stock trading platforms, among others. Digital Payments Leads The Way Payment companies make up 39% of FinTechs in Nigeria. Digital lenders constitute the second largest niche with 28% of all FinTechs belonging to this category. Payments also lead in terms of the value of transactions recorded, with about $10.56 billion believed to have been processed via digital payment channels in 2021. That amount is expected to rise to $12.15 billion in 2022. By contrast, the transaction value achieved by neobanks was about $781 million in 2021 and could reach $1.66 billion in 2022.
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Lagos Remains At The Heart Of The Ecosystem According to Asoko Insights, about 90% of the top companies in FinTech are headquartered in Lagos. Most of the rest are located in Abuja. Lagos also has the highest FinTech adoption rate of any state in the country, with half the population of its youth and lower-middle-income earners using at least one platform of this kind. FinTech Adoption Is Largely Driven By Referrals A McKinsey report says that 55% of Nigerians who utilize financial technology solutions say they were introduced to them by a friend. About 65% of women polled in Lagos confirmed that they had heard about the FinTech product they used from a contact of theirs. Not surprisingly, many FinTechs have incentivized referrals in order to drive greater signups on their platforms. Featured Image Source: PYMNTS
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This article was first published on 11th November 2022 and updated on November 29th, 2022 at 2:48 pm


Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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