MTN Nigeria’s mobile money arm, MoMo PSB, is facing a major challenge as active wallet users decline by 46%, prompting a strategic overhaul to stay competitive in the fintech space.
MoMo PSB, a subsidiary of MTN Nigeria, has seen a drastic decline in active wallets, losing 2.5 million users in 2024 alone. The drop has raised concerns about the platform’s growth and sustainability in Nigeria’s mobile money market.
During an investor call, MTN Nigeria CEO, Karl Toriola, stated that the company is shifting focus to improve service penetration, increase monetization, and reduce customer acquisition costs. This comes as competition in Nigeria’s fintech sector intensifies, with major players like Opay, Moniepoint, and PalmPay dominating the market.
Despite its strong presence, MoMo PSB has struggled to keep up with competitors due to several limitations such as:
- Regulatory Restrictions: The Central Bank of Nigeria (CBN) limits Payment Service Banks (PSBs) from offering loans or forex services, reducing their revenue potential.
- Agent Network Decline: MoMo’s agent network shrank from 327,000 in 2023 to just 68,016 in 2024.
- Cash Deposit Drop: Wallet deposits plummeted by 50%, falling from ₦7.6 billion to ₦3.8 billion.
- Shift from Agent Banking: The company appears to be moving away from agent-based transactions towards a digital-first strategy.
Despite the decline, MoMo PSB is pushing forward with plans to diversify its services. The company has applied for Payment Service Solutions Provider (PSSP) and Payment Terminal Service Provider (PTSP) licenses. These will enable it to offer merchant aggregation services and manage point-of-sale (PoS) terminals.
Additionally, MoMo PSB aims to focus on user engagement and retention strategies to reverse the decline and re-establish itself as a key player in Nigeria’s digital finance ecosystem.
Right now, MTN’s MoMo PSB faces an uphill battle, but its new strategy could determine whether it regains lost users or continues to struggle against Nigeria’s rapidly growing fintech giants.
