Fintech

Digital Bank in Nigeria: List of Digital Banks in Nigeria

Published

3 years ago

October 6, 2021

Digital Banks in Nigeria - Investors King

Neobanks, popularly known as digital banks in Nigeria, are fintech companies that offers mobile applications, software and other technologies to streamline financial services and banking in Nigeria. These digital banks are growing at a faster pace in Nigeria, especially given the fact that they do not charge certain fees imposed on customers by traditional banks and are easy to set up.

Generally, they tend to be more transparent and nimble than megabanks, even though many of them, like Kuda Bank, Vbank etc partner traditional banks.

Here is a list of Digital Banks Operating in Nigeria Presently

Vbank
Kuda Bank
Alat by Wema Bank
Sparkle
Mint
Onebank
Rubies

Lets quickly look at pros and cons of each of the digital banks in Nigeria

Vbank

VFD Microfinance Bank is a fully digital bank that offers a wide range of financial products and services to professionals and entrepreneurs across all sectors. The digital bank has over 100,000 downloads on Playstore. They offer zero charges on transactions. Free account maintenance, monthly interest on savings, swift and secure transfers, withdrawals, and bill payments.

Pros

Instant account opening without any paperwork.
Fingerprint authorization: Login with your fingerprint and authorize transactions using your 4-digit PIN.
Good customer service.
Set up and track your spend budgets.
Order debit cards from the apps.
USSD banking service available.
Easy bill payments on the app.
Target savings with 8% interest rate.

User complaints

New update causes app to crash.
Upgrading KYC takes relatively longer.

Kuda bank

Kuda Bank is a free, digital-only bank with a microfinance banking license from the Central Bank of Nigeria. The bank includes tools for tracking your spending habits, saving more, and making the right money moves. They don’t charge card maintenance or account maintenance fees. Kuda has 1M+ downloads on Playstore. Its customers get 25 free transfers to other banks every month.

Pros

Free debit cards.
Good user experience.
Free withdrawals at over 3,000 ATMs across Nigeria.
15% annual interest rates on savings.
No paperwork involved when signing up.
Automatic budgeting tools for easier money management.

User complaints

Cards often take a long time to arrive.
No SMS notification when you get credited.
No USSD code option for transactions.
Identity verification takes time.

AlatbyWema

ALAT is Nigeria’s first fully digital bank, designed to help you do more with your money. Alat is owned by Wema bank. Just like every other digital bank, there is no need to visit a bank to open an account. Alat has over 500,000 downloads on Playstore.

Pros

Free bank card delivery anywhere in Nigeria.
A Virtual Dollar Card for online payments.
Bill payments option.
Collateral-free loans are available.
Save easily with automated goal saving.

User complaints

The virtual card does not yet work.
Delay in physical card delivery.

Sparkle

Sparkle is a lifestyle and finance app. It is a digital ecosystem providing financial, lifestyle, and business support services to Nigerians around the world. Licensed by the Central Bank of Nigeria (CBN), Sparkle is all about helping people achieve what they want, whether it’s entertainment, education, saving, or investing in the future. Sparkle has over 100,000+ downloads on the play store.

Pros

Create an account with just your Bank Verification Number (BVN), email address and phone number.
If you ever lose or misplace your card, you can freeze and unfreeze it in the Sparkle app.
Save using Sparkle Stash for different goals at the same time.
Percentage savings where you determine what percentage of your account balance will be going to your savings every day, week or month!
Get real-time instant notifications for your transactions.
Bill payments; Pay your bills whenever you want, wherever you are.
Split bills with friends and family on the app.
Physical and virtual cards available.

User complaints

New update causes the app to crash.
Reversal on failed transaction takes time.
Cards can’t be used for international transactions.
Poor customer service.

Mint App

MyMintApp is a self-service platform developed for customers to carry out a range of digital and mobile banking transactions on their accounts. It offers customers benefits such as convenience, speed, online real-time access, the security of transactions and options to initiate basic service requests without having to physically visit the bank.

MyMintApp also offers different banking services such as SME Banking, Personal Banking, Corporate Banking, Internet Banking (Electronic Banking), Current Account Opening, Savings Account Opening, Business Services, Loans, e-Business Solutions, Personalized Money Tracking and Card Solutions, etc. Mint has over 10,000+ downloads on Playstore.

Pros

Good customer service.
Seamless account funding via Paystack or directly from your existing bank account.
Different saving goals with competitive interest rates to help you save for a targeted purpose.
Money Manager to help you tag your expenses according to the most common categories, and see real views of how and where you spend monthly.
Zero transaction fees on bill payments.

User complaints

No bonus when you refer someone to the app.
The selfie verification process takes time.

Onebank

Onebank brings a whole new financial and non-financial experience to the digital space. This application comes with sophisticated features and an impeccable user experience. It is highly secure, convenient, and easy to use. Onebank also offers payments, lending, investment, advisory, informational, and lifestyle services which brings that intuitive banking experience on your mobile. Onebank is owned by Sterling Bank

Pros

Create a wallet account instantly with your mobile number.
Biometric authentication.
Instantly create your virtual card for online shopping and decide the card’s usage and expiry.
Investments; enjoy up to 100% returns on Naira and Dollar investments.
Quick loans of up to N5 million in 5 minutes.
Receive money from Onebank user via QR code scan.
Pay for airline tickets, cable & internet subscription directly on the app.
Cardless withdrawals are available.

User complaints

Prone to error when you try to sign in.
Bad user experience.
Transaction history only shows debits and not credit transaction.
Failed transactions take time to be reversed.
Difficulty when you try to switch devices.

Rubies

Rubies is a digital bank that disrupts regular banking by providing 100% digital top-notch services and technology at its peak. With Rubies, you can decide what your account number looks like. Rubies give you the financial freedom to do more than just banking and the app has garnered over 100,000 downloads on Playstore.

Pros

No maintenance fees.
Free Debit Cards: Also comes with an option of free delivery.
Independent Banker: Refer people and earn every time they transact on Rubies.
Customizable Account: Decide what your Account Number looks like.
Proximity Transfer: Transfer money easily to friends on Rubies around you with a single tap.
Open Account: Get an account on the fly, from anywhere (App, Website).
Request Money: Request funds from friends on Rubies with a single button.

User complaints

Verification process takes time.
BVN verification unstable.
App downtime takes more than 24 hours to resolve.
Difficulties upgrading account.

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Samed Olukoya

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Fintech

Fintechs Instructed to Report Cryptocurrency Transactions to Authorities in Nigeria

Published

2 hours ago

May 4, 2024

Samed Olukoya

Fintech companies across the country have been instructed to report all crypto trades to relevant authorities.

This directive comes amidst the recent freezing of 105 accounts across nine fintech firms suspected of various illegal activities, including unauthorized forex dealings, money laundering, and terrorism financing.

The Economic and Financial Crimes Commission (EFCC) obtained an interim court order on April 24, 2024, to freeze these accounts for 90 days as part of ongoing investigations.

Sources close to the matter suggest a connection between these freezes and heightened scrutiny of cryptocurrency transactions.

Following these regulatory actions, several prominent fintech players, including OPay, Moniepoint, PalmPay, and Kuda Bank, have been directed to suspend the opening of new accounts temporarily pending evaluations of their Know Your Customer (KYC) processes by the Central Bank of Nigeria (CBN).

The frozen accounts are part of a broader investigation by the EFCC into 1,146 bank accounts suspected of manipulating the foreign exchange market through cryptocurrency platforms.

The EFCC believes that some account owners exploited cryptocurrency platforms to manipulate the FX market.

In response to these developments, fintech firms have started implementing stringent measures against cryptocurrency transactions.

Moniepoint, for instance, notified its customers that it would close accounts engaged in crypto or virtual asset transactions and share their details with relevant authorities.

Similar warnings were issued by other fintech players like Paga and OPay, emphasizing their stance against crypto-related activities.

During a recent industry event, Tosin Eniolorunda, founder and CEO of Moniepoint, urged participants in crypto Peer-to-Peer (P2P) markets to cease their activities due to regulatory prohibitions.

He highlighted the risks associated with engaging in such activities, citing potential legal repercussions.

Eniolorunda linked the recent regulatory actions to the prevalence of fraud in fintech apps and emphasized the renewed focus on KYC and Anti-Money Laundering (AML) measures.

He alleged that some P2P crypto activities contributed to the manipulation of the Nigerian currency, the naira, prompting regulatory intervention.

This latest directive underscores Nigeria’s broader crackdown on cryptocurrency platforms, particularly Binance, which began earlier in 2024.

The government has expressed concerns about the role of crypto platforms in currency speculation and their impact on the devaluation of the naira.

This regulatory tightening reflects the government’s efforts to maintain financial stability and curb illicit financial activities in the country.

Fintech

Nigeria’s OPay Valuation Hits $2.7 Billion Amid Digital Payments Surge

Published

4 days ago

April 30, 2024

Samed Olukoya

Nigeria’s OPay, the fintech startup that has been making waves in the country’s digital payments landscape, has seen its valuation soar to $2.7 billion.

This represents over 30% since its Series C funding round in 2021.

This surge in valuation shows the exponential growth of Nigeria’s digital payments sector and the increasing prominence of financial technology companies within the nation’s economy.

The valuation update comes from recent corporate filings made by Opera, an early investor in OPay. Opera’s stake in OPay gradually declined over the years to 6.4% by 2021.

However, a strategic move in early 2023 saw Opera increase its stake to 9.4% after selling its Asian fintech subsidiary, Nanobank, to OPay in exchange for equity in the company.

According to filings with the US Securities and Exchange Commission (SEC), Opera valued its 9.4% stake in OPay at $253 million, reflecting the $2.7 billion valuation of the fintech startup.

OPay’s meteoric rise can be attributed to several factors, including Nigeria’s increasing adoption of digital payments and the company’s innovative services.

The surge in digital payments volumes, driven in part by an ill-timed currency redesign that led to cash scarcity, has propelled OPay’s growth.

As more Nigerians turned to fintech apps like OPay for transactions, the company experienced a quadrupling of its user base in 2023, accompanied by a revenue growth of over 60% on a constant currency basis, according to Opera.

Despite its rapid growth, OPay, like other fintech companies, faces challenges related to fraud and customer safety concerns.

Regulatory bodies, including the Central Bank of Nigeria, have tightened rules on account safety, highlighting the need for OPay and similar companies to address these issues while continuing to innovate and expand their services.

As Nigeria’s digital payments ecosystem continues to evolve, OPay’s rising valuation underscores its position as a key player in driving financial inclusion and transforming the country’s economy through innovative technology solutions.

Fintech

From Trading to Credit: Robinhood Launches No-Fee Credit Card with Gold Membership Perks

Published

1 month ago

March 27, 2024

Samed Olukoya

Robinhood Markets Inc. has announced the launch of its highly anticipated no-fee credit card and it was accompanied by exclusive perks for Gold membership subscribers.

This bold move is a step in the company’s mission to evolve into a comprehensive financial services provider.

The Robinhood Gold Card boasts an array of enticing features. Chief among them is the absence of annual costs or foreign transaction fees, positioning it as an attractive option for consumers seeking financial flexibility.

Moreover, cardholders stand to benefit from a generous 3% cash back on all categories of purchases, a competitive offer in comparison to industry rivals.

Vlad Tenev, CEO of Robinhood, emphasized the company’s commitment to innovation and industry leadership in an interview.

He expressed the intention to not merely introduce a credit card, but to revolutionize the market with a product that sets new standards for customer satisfaction and financial empowerment.

The announcement has sparked enthusiasm among investors, with Robinhood’s shares witnessing a 6.9% surge in early market trading following the news.

This surge further underscores the market’s confidence in the company’s strategic direction and its potential to disrupt traditional financial services.

Beyond the credit card venture, Robinhood has been steadily diversifying its offerings. With the introduction of retirement products and the expansion of commission-free trading services internationally, the company is positioning itself as a formidable player in the global finance landscape.

As Robinhood continues to innovate and expand its suite of services, its trajectory suggests a promising future as a leading force in democratizing access to financial tools and services.