INVESTING IN NIGERIA'S FINTECH? HERE IS HOW TO GET THE CBN LICENSE

Nigeria has become a hotbed for fintech innovation in recent years, with the fastest-growing number of startups in Africa that are always looking to disrupt the traditional financial services industry.

The country has the largest population in Africa with over 84 million internet users, which is 40% of the country's population, and is set to rise to 114 million users by 2027, making it an attractive market for digital financial services. 

This article's main goal is to provide you with the best approach to investing in fintech in Nigeria and how to obtain the required CBN license.

Firstly, here are some key points to note:

• The CBN regulates all fintech operations in Nigeria since 2014.
• Nigeria is home to the highest number of fintech operators in Africa with over 200 companies and over $14m in transactions already in 2023
• Knowing what to watch out for makes investing in Nigeria's fintech sector less complicated.

What exactly is fintech?

Financial technology, or fintech, is the term used to describe the use of technology to deliver financial services. This might range from platforms for investing and insurance to digital lending, mobile payments, and general banking operations. 

If you take your traditional banks and put them exclusively online, you have a fintech company.

Fintech businesses in Nigeria provide a variety of services, which include mobile payments, savings and investment platforms, online loans, and insurance. 

The huge unbanked and underbanked population in the nation, which has limited access to conventional financial services, is the target audience for many of these services.

Some of the popular ones are Paystack, Flutterwave, Piggyvest, and many others.

How to start a fintech in Nigeria

Below are professional tips on how to start a fintech in Nigeria 

Step 1. Conduct detailed market research: It is crucial to do your homework and grasp the competitive landscape before beginning a fintech. Who could be your future clients? What are their requirements and problems? Who and what are your rivals' product offerings? Also, you should learn about the regulatory framework and the authorizations required to operate legally.

Step 2. Creating a Business Plan: You should create a thorough business plan that details your product or service offering, target market, marketing approach, revenue model, and financial predictions based on your market research. This will be your road map for starting and expanding your financial business.

Step 3. Create your team: To create and run your fintech, you'll need a group of people with the appropriate business knowledge and experience, preferably tech-savvy individuals. Developers, designers, marketers, and customer care agents may all fall under this category. 

To make use of their experience and resources, you should also think about forming partnerships with well-known financial institutions or fintech businesses.

Step 4. Create and test your product: As soon as you've assembled a team, you can begin creating your good or service. To make sure that your product satisfies the needs of potential customers, it's critical to do user testing and collect feedback.

Step 5. Launch and promote your fintech: As soon as your product is complete, it's time to go live and promote your fintech. Advertising, social media, and other marketing avenues may be included in this. To expand your user base, you should also form alliances and collaborate with other businesses in the sector.

How to get a CBN fintech license.

After registering your company with the Cooperate Affairs Commission (CAC), the next step is to get the requirements for licensing from the Central Bank of Nigeria (CBN). Here are some of the requirements for getting a CBN license for your fintech, 

It is important to set up your own legal team to fast-track the legal processes, stay ahead of updated information from the apex bank, and understand the financial requirements.