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The Money Must Be Over There

Tech publications spend all their time analysing other businesses and often seem reluctant to discuss themselves. Host a handful of journalists, and they’ll prattle on endlessly about our dear tech ecosystem. Will they debate how the media business they work in is hanging on for dear life? Don’t hold your breath.

I suppose anxiety over whether AI will take our poorly paid jobs, or our employers striking first and laying us off, makes these conversations difficult.

So tech journalists will only discuss the media business in the occasional but mind-numbingly predictable “tech startups vs. media debates.”

Fortunately, this week has given us quite a good deal of media fodder to analyse. On Thursday, Fatu Ogwuche of the Big Tech This Week newsletter launched her weekly live show (a format popularised by TBPN and The Information’s comically named TITV).

Semudara Abayomi, an independent creator who built his audience on video, also launched a daily digest he’s calling Bayomi. Independent publications and creators are expanding their surface area at the same time as established publications.

I’ve always thought that storytellers should experiment across formats. Some things are great to write about and would also be fun to make videos about and there’s nothing like figuring out a new format to keep you humble. Africa Built gives me room for audio conversations, and because I watch an unreasonable amount of YouTube, I also want to make fun videos.

There is no grand commercial revelation to report yet because I’m still trying to get videos out consistently and find editors who Nigerian skitmakers haven’t ruined.

You can start recording videos with a phone and free software, but the harder work is making something worth watching every week. If you cannot edit, your ability to make the thing in your head depends on surrounding yourself with people who know what they’re doing. Finding those people, developing a shared idea of what good looks like, and producing consistently is a tough education.

Still, we all must experiment because if subscriptions aren’t going to pay the bills for Nigerian tech media, something else has to.

In the last three or four years, the answer has been events. TechCabal has Moonshot, Condia held Borderless this year, and GITEX brought their spectacle to Lagos. Today, if you shake a tree, any tree at all, a technology-focused conference will fall out of it.

Events help publications connect the seemingly disparate things they’ve been doing all year. An event brings people the publication has been reporting on and building relationships with to discuss the issues that have captured imagination and fascinated WhatsApp groups for most of the year.

But events are expensive, demanding a worrying amount of time and attention. And when they’re over, you want to have made a healthy margin because it’s insane to put your team through two or three large conferences a year just to make the economics work.

But imagine that your conference goes off without a hitch, your sponsors are pleased, and attendees want another edition. Your team basks in the satisfaction of having pulled off something impressive, and you’ve broken even. Does anyone need to say that your event is now set for a second year?

A few editions later, you’ve progressed from breaking even to a net margin of 10%. Is that a success? It might be. But how much of the company’s year did it consume, and what else could your people have built with that time?

TechCabal ran Future of Commerce for years before arriving at Moonshot, suggesting that finding a commercially successful format can take several attempts, and a publication needs the resources to survive the search.

Video is a more accessible experiment that doesn’t need you to commit to a large production months in advance. You can also reach people who were never going to read your publication.

Skitmakers have proven the business case, showing that advertisers will pay to reach a large audience. Publications want some of that money, but the challenge is to make something people watch by choice rather than professional obligation.

OpenAI’s acquisition of TBPN made a live technology show look like a spectacular business opportunity. But the buyer was also interested in the team’s communications and marketing capabilities, and placed it within its strategy department.

This week, TBPN’s president, Dylan Abruscato, described a business in which some sponsorship agreements included communications and marketing advice. OpenAI wanted those capabilities for itself. The show had helped build something valuable beyond the programme viewers watched.

Publications will argue that they can take this one problem at a time; the first is developing shows people want to watch, but original reporting, industry knowledge and access to guests do not automatically guarantee a good show.

Creators start with an advantage here because their audience has already chosen them and their way of explaining the world; adding a digest extends that relationship.

Publications will tell you for free that original reporting is a painful process that requires sources, verification, chases that never become anything, and sometimes a reputation of being too critical or cynical.

Ultimately, the convergence is fascinating. Publications want the direct audience relationships creators have built, and creators want to use their authority to expand to other lanes in their bid to become bigger operations. Neither transition is as straightforward as opening a YouTube channel or launching a newsletter.

There is the less exciting matter of who pays for all of this.

Across the industry, everyone is adding things to sell to many of the same fintechs, telcos and banks. More programmes mean more opportunities, but they also mean more competition for budgets.

There are ways to grow beyond that constraint, like making something useful enough for an advertiser to spend more or broadening your coverage into industries whose advertising budgets you’ve barely touched.

That last possibility is one reason business and finance are attractive territory. But adding those words to a publication’s description is the easy part; you still have to produce work that earns the attention of people outside your existing circle.

None of this is an argument against experimenting. I am making videos because I want to make them, and because I think some of our stories deserve to be seen as well as read.

Publications and creators will keep crossing into each other’s territory. Some will build much better businesses as a result, and others will find a healthy respect for the new lanes they cross into.

And before you run off, I’m making videos too.

We started with a question: how did OPay lend $1.5 billion in one year? Watch, like it (it’s by force), share it with your friends and enemies and leave a comment.

See you on Sunday!

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Around here, I often say lending is easy. Once you lay your hands on some cheap funding, you can call TechCabal and brag about how AI drives your lending decisions and underwriting.

You won’t need ads because your subprime borrowers will sniff you out on launch day.

But before you can lend anyone ₦100, somebody has to give you ₦100. Who you get ₦100 from, what they charge, and how quickly they want it back will shape everything you do as a lender.

A bank can get money from equity, borrowing, or deposits. Equity is expensive because shareholders expect a return/dividends, etc. Borrowing (interbank money, bonds, swaps and the like) is priced close to market rates and can be hard to access when everybody gets nervous.

Deposits are the good stuff.

Current accounts hold the money companies need for salaries and suppliers. The money you and I need to survive until the next salary alert usually sits in a savings account and pays interest, though not enough to make you rich.

Term deposits, a.k.a. fixed deposits, are different. Once you ask a customer to tie their money down with you, you are competing with treasury bills, money-market funds and Credit Direct’s Yield offering.

So for banks, the ideal customer is the one who leaves enormous amounts of money sitting around while asking for very little in return.

Nigerian banks know how to find these people, and even then, GTCO is a different animal. Customer deposits fund 76.2% of its balance sheet, and current and savings accounts make up 81.7% of those deposits; term deposits are just 18.3%.

That it keeps attracting deposits even as competition has intensified from banks and a range of fintechs is impressive. GTCO’s interest expense came in at ₦223.8 billion for the half, roughly 3% of its average deposit base, annualized.

The better borrower

In the first half of 2026, customer deposits increased by ₦1.42 trillion, while net loans grew by ₦20 billion. Investment securities, on the other hand, grew by more than ₦1.2 trillion in what GTCO called the “continued deployment of the expanded funding base.”Cheap funding is only valuable if you have somewhere profitable to put it, which in GTCO’s case, is buying government securities.

Government securities (zero risk) generated ₦382.9 billion of revenue in the first half while loans (risky!) generated ₦347.9 billion.

But don’t write off loans just yet. The ₦347.9 billion in revenue those loans brought in was on an average loan book of about ₦3.14 trillion, which works out to a return of roughly 22% a year, compared to the 21% on a one-year treasury bill at the end of June. Lending isn’t a bad business for GTCO; it’s just a small one.

Nubank, the Latin American digital bank, has the opposite problem. It pays depositors about 12% a year, and government paper pays about 14%; that two percent spread won’t cover costs and deliver a profit, so Nubank does a lot of lending.

GTCO pays roughly 3% on its deposits, so even after the CBN holds back a large share as cash reserves, the government pays it about 19% on the rest; it’s making a fortune not lending.

So when people predict that falling yields (the CBN cut its policy rate sharply in September) will force GTCO to lend more, you have to see if history supports that prediction. The Orange bank has told investors it will grow loans by 25% this year; after a first half in which the loan book barely moved, meeting that target will mean lending about fifty times as much in the second half as it added in the first. I will not be holding my breath.

In 2020, when treasury bills paid almost nothing, and the CBN was trying to force banks to lend out 65% of their deposits, GTCO ended the year lending out a smaller share of its deposits than in 2019, and it lends a smaller share still today.

And while GTBank launched QuickCredit, a digital loan for salary earners and the self-employed, in 2019, it has kept the product small. Its pragmatism has flown in the face of fintechs ramping up lending to anyone in sight.

If you argue that GTCO can, on the evidence of companies like Credit Direct, Fairmoney and OPay, make its retail lending larger, the bank will remind you that caution has always served it well.

In 2009, the CBN sacked the chief executives of eight banks after margin loans and bad debts ate through their capital, and GTBank was not one of them.

GTCO can lend, but it chooses not to because that’s the rational decision given Nigeria’s macroeconomic condition, so the question is how long the bank can keep choosing not to lend.

If GTCO’s customers keep their deposits with the bank (not even the debacle that was their 2024 migration to Finacle made them lose customers), then the bank doesn’t have to really care about lending. The fintechs that are lending use said lending as a strategy to eventually get cheap deposits.

When OPay and PalmPay launched, they targeted customers the banks were indifferent about; people who dealt mostly in cash and would not fill a six-page account-opening form. If you looked only at revenue per customer, you could reasonably wonder what the fintechs were smoking.

But Nigeria had a cash scarcity in 2023; bank apps struggled with the load while OPay, PalmPay and Moniepoint mostly kept working. PalmPay tripled its users in about a year.

While people moved their payments to these apps, they didn’t immediately move their savings. One bread seller told Semafor she took payments into OPay because they arrived instantly, then moved the balance to GTBank every evening because that was where she felt safe keeping it. But that habit is weakening.

Agusto says fintech-led microfinance banks, including OPay, PalmPay and Moniepoint, are now gathering substantial merchant settlement balances at low cost. So more traders are leaving their takings in the app overnight, and loans will speed this up.

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Credit also pulls deposits because lenders like OPay set limits based on how much passes through your account, how often, and how much stays there. A trader who wants a bigger limit has every reason to leave her takings in OPay instead of sweeping them to GTBank at night. Banks have always worked this way; QuickCredit is underwritten on the salary in your GTBank account.

OPay lent nearly four times as much last year as in 2024, to 4.6 million borrowers a quarter, set aside about an eighth of it for loans that might not come back, and still made money.

Through that expensive process, it knows how a trader in Oshodi repays a ₦50,000 loan because it has lent to millions of traders and lost money on some of them. GTCO’s record on small borrowers is thin, and the only way to thicken it is to lend to them and take the losses.

GTCO will say it can catch up whenever it chooses. In payments, HabariPay made ₦7.8 billion in profit; payments reward scale and infrastructure, which a rich parent can buy. But credit knowledge can’t be acquired; it can only be earned through doing.

Ultimately, it doesn’t even matter because this whole thing is about winning deposits. The fintechs aren’t really trying to out-lend the Orange Bank if they can help it. They’re trying to win deposits, one loan limit at a time.

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*Notadeepdive will take a break for the rest of October, as is our custom. Africa Built, our joint podcast with Fintech is easy, will run as usual. See you in November!

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Hope you are all enjoying the international break.

Remember the first rule of the international break: never believe everything you read in the news, because journalists and influencers alike are bored and need to drive engagement somehow. The second rule is also simple: Henry, Kevin De Bruyne, Ronaldo - Top 3 in the EPL, in that order.

Last Season we made the league table and a FinTech starting XI. This season, we are making season predictions.

Everyone starts off the football season making predictions, but I prefer to play it safe by waiting until the window is closed and the first international break has arrived, seeing as Enzo Maresca’s new-look Blues will determine my mood and my publishing schedule for the next 11 months.

Manchester City are top of the league heading into the break, continuing where they left off in a two-horse race against Arsenal. Manchester United are so bad Old Trafford is now a prayer ground; can someone send pastors to Chelsea and Tottenham’s stadiums as well?

This is not a football newsletter, I promise.

In Nigeria, as the season has started, major moves have been made, from Flutterwave appointing a new CFO, to Piggyvest releasing a new suite of products and features at their open house, to Uber’s exit, the Monieworld shutdown, and the Dangote Refinery IPO.

So here are a few safe or satirical predictions for the next 11 months, depending on your point of view.

Heads up: this is entirely unserious business.

Sure 2 Odds

Every Flutterwave interview, press release, or article asks the IPO question

With OPay publicly courting IPO press, the media pressure on Flutterwave will intensify within the next 11 months, as every move they make will be scrutinised through that lens.

The Providus-Unity Merger becomes a technology post-mortem

Last year, the core banking upgrades of GTCO, Zenith, and Sterling Bank left their customers stranded for months. Following the Providus-Unity merger, customers seem to be having a terrible digital experience due to the weight of the merger. Expect these pains to last into the new year.

Yet another financial services platform gets breached

Already this year, Sterling Bank, Remita, and now Fairmoney have been breached by attackers, leaving financial services platforms vulnerable and leaking customer data in the process. With the rise in AI attacks and hacks, coupled with upcoming elections, the cybersecurity industry is not prepared to mount a strong defence against threats in the coming months.

A prediction markets platform will get in trouble

Between regulatory clarity and trading on election results, prediction markets may find themselves in regulatory or political hot water in the coming months. Consumer protection or electoral manipulation, take your pick

Undisclosed Q4 Acquisitions

As the year winds down, companies start being honest with themselves on meeting year-end projections and how much runway they have left. The end of the year is traditionally when deals get closed quickly, and we should be expecting this trend to continue. Let us know potential acquisition candidates in the comments

Last-minute Detty December features

Nothing says Q4 in Nigeria like those last-minute, usually half-baked features and products built for the sole purpose of capitalising on the Detty December wave and Diaspora market. The best time to plant a tree was in February, people. If your December feature isn’t on ice and ready to be announced by October, do not bother.

Wildcard bets

The Moniepoint V OPay battle gets ugly.

With the exclusivity rules in place, and the CBN market-share rules, which stop anyone holding more than 25% of card issuing from holding more than 15% of merchant acquiring (and the same in reverse), these two companies, which lead in both categories, will take their long-running turf battles to new, ugly heights. The winners, as always, will be the customers and the lawyers involved.

Glovo leaves Nigeria

Uber left Nigeria on 2 September, and a day later Delivery Hero’s board backed Uber’s offer for the company that owns Glovo. Once that deal completes, expect Uber to pull the plug on Glovo here too, leaving Chowdeck and Swoop to feed the market. Completion is some way off, since shareholders have until 5 November and competition authorities on several continents still get a say, so this one could take time.

Stablecoin/Multicurrency/remittance market consolidation begins

Everywhere you go, there’s a platform trying to sell you stablecoins, remittances and multicurrency accounts, and at this point there are more platforms in existence than customers who need these products.

Using Monieworld as an example, and the fact that Nigerian banks are now taking that same customer profile seriously again, expect rollups, consolidations and mergers of different kinds in this space.

Jumia becomes profitable

Nothing to add here; listen to our two episodes on Jumia for the Africa Built podcast on Africabuilt.xyz or read through the Notadeepdive Jumia archive.

The Accumulator

• Someone launches an AI chatbot

• Someone closes shop and invokes Teddy Roosevelt’s “man in the arena” on the way out

• Nigerian regulators continue to issue contrasting pieces of regulation for the same industry

• MTN MoMo tries to compete again in the press

Signing of the Season

Not a company. A technology. Just like Pep playing out of the back or Klopp’s gengenpressing style.

Stablecoin settlement.

Specifically settlement, not payments.

With SWIFT finally running a blockchain ledger pilot with 17 banks in July, and PAPSS expanding its blockchain functionality, expect the CBN and the banks to join in, starting with moving money between their own entities across multiple countries.

Under Pressure

• Consumer neobanks without a merchant business.

• Crypto exchanges

• Standalone lenders

• African Expansions

Leicester 5000/1 odds

Uber comes back to Nigeria

Let’s imagine that the country’s economic fortunes turn around favourably following the elections such that Uber reverses its decision and re-enters the Nigerian market. I can already see part of the LinkedIn and Twitter hot takes.

That’s it; see you all at the end of the season

Hashtag Not Guilty Your Honour !!

Let us know your picks for Manager of the Season, Breakthrough of the Season, Dark Horses, and Biggest Flop.

Leaderboard so far

Here’s today’s reminder that you can generate a referral link here and tell other awesome people like you to subscribe.

If you’re top of the leaderboard at the end of the week, you win a ₦20,000 voucher to take someone you referred to lunch. You can talk about Notadeepdive while you eat. If your referrals bring us five new subscribers, we’ll even send you a T-shirt, and if ten awesome people show up, we owe you a really fine journal.

LISTEN TO AFRICA BUILT

In the fourth episode of Africa Built, we conclude our two-part series on Interswitch.

Part One ended in December 2010, when Helios bought two-thirds of the company from the founding banks.

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See you next week!

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Instead of a regular Notadeepdive edition today, we’re going to take today’s newsletter to ask you to do something instead.

If you’re a subscriber, you probably found Notadeepdive because someone recommended it or shared it on your timeline or LinkedIn page. Heck, it could have been a screenshot in your three person group chat. Wherever they evangelised to you, they were sure you’d love the newsletter (and they were right).

Anyway, because we always want more, we’ve decided it would be nice to get to 6,000 subscribers. Also, what’s wrong with a little ambition?

We thought about running ads, like that time Kuda’s ads were everywhere but in your dreams. But what we know for sure is that if you read Notadeepdive, you know the few more people who should definitely be reading our work.

All of this preamble is basically to say we’re relaunching our referral campaign.

You can generate a referral link here and tell other awesome people like you to subscribe.

And for the fun of it, we’ve even created a leaderboard.

If you’re top of the leaderboard at the end of the week, you win a ₦20,000 voucher to take someone you referred to lunch. You can talk about Notadeepdive while you eat. If your referrals bring us five new subscribers, we’ll even send you a T-shirt, and if ten awesome people show up, we owe you a really fine journal.

Alright, time to get cracking. Think of one person all the people who should be reading Notadeepdive, and send them your link. If they subscribe, you climb the leaderboard and they get a better inbox. Win-win.

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See you on Sunday, and hopefully you’ll be sitting pretty atop the leaderboard.

P.S. This week’s two editions are here and here.

And before you run off, listen to the latest edition of the podcast:

LISTEN TO AFRICA BUILT

In the fourth episode of Africa Built, we conclude our two-part series on Interswitch.

Part One ended in December 2010, when Helios bought two thirds of the company from the founding banks.

Listen Now

If you missed Tuesday’s Notadeepdive, catch up here.

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On Wednesday morning, the gates of Alerzo’s office on MKO Abiola Way in Ibadan were shut. Two Hilux trucks sat in the compound, but there were no security guards around. Shop owners on the street told Notadeepdive there had been no activity at the premises in months.

Alerzo, a venture-backed startup that bought fast-moving consumer goods such as soap, milk and sugar in bulk and delivered them to small shops, has paused operations, two people with knowledge of the business told Notadeepdive. Its Lagos office has been closed for more than a year, which the company attributed to a shift to remoto work. Two of its listed warehouses on Google were empty.

Its website returns an error page, and internet archives suggest it could have been inactive since April.

I asked Adewale Opaleye, Alerzo’s founder, if the company had shut down.

“We’ve had to mothball a significant portion of our operations,” he said. Mothball is a term for ships and power plants that are taken out of service but kept intact in the hopes of a possible return.

“We’re making decisions. Laying off employees who [are] obviously not doing anything. Since around November and December, we’ve let non-critical employees get jobs elsewhere.”

The company has also been looking for a buyer. The same two people said Alerzo approached UAC Nigeria about a sale, but no deal followed. Although Alerzo’s valuation has never been publicised, one person with knowledge of the business said a 2022 funding round took its valuation north of $80 million. Selling below that figure will force every fund on the cap table to book a write-down.

“We’ve had a lot of conversations with multiple people,” Opaleye said about sale talks, declining to discuss specific companies.

When he founded Alerzo in 2018, Opaleye’s inspiration was his mother, who ran two stores in Ibadan. Everytime she wanted to restock items, she had to close shop and travel for hours to buy goods. Alerzo promise was that retailers like her could order from their phones and have the goods delivered, leaving them free to keep selling.

It was an obvious improvement for the shopkeeper, but Alerzo’s task was to provide the service cheaply enough to make money on the goods it sold. That required some doing; traditional distributors have a 2-5% margin on products and they guard it jealously. Building a technology operation atop those margins would be herculean.

Investors were convinced it could work and in 2021, Nosara Capital led Alerzo’s $10.5 million Series A round. Its managing partner, Ian Loizeaux, praised the company’s “exceptional unit economics”.

Eight years after its founding, Alerzo is trying to sell what remains of that promise.

Opaleye said bad press had complicated conversations around a sale. In February, a video circulated on X showing rows of dusty Alerzo-branded buses and motorcycles at its Ibadan facility. An off-camera voice invited the public to buy them in bulk.

Technext reported that Alerzo was selling its delivery fleet after defaulting on a ₦5 billion working-capital loan from Moniepoint Microfinance Bank. Alerzo denied the story.

According to court filings, Alerzo took the loan in January 2025, with repayment due over 18 months but by December, ₦4.38 billion remained outstanding, with interest still accruing.

On January 30, a Federal High Court in Lagos ordered banks to freeze funds and assets belonging to Alerzo, Opaleye, three personal guarantors and the company’s Singapore holding entity, up to the value of the debt. The order was an interim measure to preserve assets pending judgment, not a ruling that Moniepoint’s claim had been proven.

But the bad press predates the Moniepoint loan and began when the company started laying off employees.

Alerzo has offered a different explanation for every round of layoffs. It has cited digitisation and a “profitability push.” It has also talked about a new warehouse management system that “meant streamlining and consolidating certain warehouse roles.”

On Glassdoor, where Alerzo was rated 3.7 stars in 2022, it now sits at 2.4, with only 27% of reviewers saying they would recommend working there to a friend. The reviews describe unpaid salaries, a “chaotic atmosphere,” and “unprofessional management.”

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Between 2020 and 2022, African B2B commerce startups raised more than $470 million but their return to earth has been just as stunning.

MarketForce began laying off staff six months after raising $40 million. Zumi and Wabi shut down and last week, GT Flow, formerly Twiga Foods One, the continent’s first mover entered administration. Sabi, which once boasted $1 billion in Gross Merchandise Value (GMV) has pivoted to exporting traceable minerals.

The pitch that drew all that capital was centred on eliminating inefficiencies in a very analogue distribution chain.

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A crate of soft drinks might pass from a manufacturer to a distributor, then through wholesalers and market traders before reaching the mallam’s stall on your street. Each intermediary must add their profit margin. The mallam on your street, who’s at the end of the chain, will then have to make a trip to collect the goods, losing hours he could have spent serving customers.

Startups proposed aggregating orders from thousands of shops and buying directly from manufacturers. That way, they could get a rebate because of the size of their orders. By delivering directly to the small retailers like the mallam’s stall, they could provide better prices and make more money. Win-win.

In practice, it wasn’t that simple; buying in bulk from manufacturers also meant having a warehouse to store items and winning over small shop owners meant promising delivery which also meant owning vehicles.

It could work if the small shops you’re delivering to are clustered around an area but the likelihood is that their retail customers just weren’t as tighly clustered.

Using technology also meant hiring engineers, customer support and other staff. The costs piled up quicky.

As I wrote in May 2025, traditional distributors kept their operations lean, often employing fewer than ten full-time staff and reserving delivery for bulk purchases. Alerzo had built a business around making that service available to small retailers. It was competing on convenience in a market where there were several other well-funded startups while selling goods customers could buy elsewhere.

A shopkeeper could appreciate the delivery and still switch suppliers for a cheaper bag of rice. She had little room to absorb higher prices because the shop next door sold much the same things. The cost of serving her could rise without a corresponding increase in what she was willing to pay.

Expanding the number of shops served was useful only if the extra business earned enough to cover the expense of reaching them.

Lending was supposed to improve the calculation because regular orders offered insights into a retailer’s buying habits, which could help a platform decide how much working capital to advance. TradeDepot built its fundraising pitch around buy-now-pay-later services, and Alerzo also introduced lending.

That brought credit risk into a business already struggling with distribution costs. In May 2025, I shared that at least two major players had suffered lending losses and paused their credit programmes. Alerzo’s lending performance remained unclear.

The same article compared Alerzo with OmniRetail, which used partner warehouses and third-party vehicles. OmniRetail said it had reached net profitability in 2024. Its approach illustrates why the cost of the operation matters as much as the ability to attract retailers. A platform that uses existing distribution capacity has a different bill to pay from a company building its own from scratch.

For Alerzo, the search is now for something beyond the business that attracted its investors. Opaleye suggested was working on something, although he did not “know if a pivot is the right word”.

“It’s obvious that being a middleman is not a sustainable business,” he said. “We’ve had to make a lot of decisions around that.”

The distributors Alerzo set out to replace would have reason to disagree. They’ll point out that while their reluctance to deliver a small order was part of what made restocking so inconvenient for Opaleye’s mother, it was also how they kept their costs down.

LISTEN TO AFRICA BUILT

In the fourth episode of Africa Built, we conclude our two-part series on Interswitch.

Part One ended in December 2010, when Helios bought two thirds of the company from the founding banks. This episode picks up the story from there and runs to today.

Revenue went from ₦39 billion to ₦137.5 billion in four years, while Verve, once the local alternative, became the card most Nigerian banks issue. Visa’s 2019 investment made Interswitch a unicorn. Three years later, a new round implied $750 million. Come October, the company repays a ₦23 billion bond it borrowed when the naira was worth three and a half times what it is now.

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If you missed Friday’s Notadeepdive, catch up here.

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The proactive bank

In the same way the British talk about the weather as a safe icebreaker, a certain kind of Nigerian professional will, unprompted, tell you how disappointing their bank is.

Said Nigerian is usually a middle-class professional who earns a salary or the owner of a small business that is doing okay.

They've had the same bank account for years, perhaps a decade, and their bank has watched every salary alert and every school-fees payment leave the account in September. It knows, better than they do, when cash flow is tight and when the good times are rolling.

And what does the bank do with all this intimate, decade-long, practically marital knowledge of their financial life? It sends them a birthday text (and may sometimes get the date wrong!) and charges them for the debit alerts.

This genre of complaint follows the logic that if my bank has all this data on me, why is it never proactive?

Why doesn’t it offer me a loan before I have to ask, flag an investment when one comes along, or play some role in my financial life beyond warehousing my money and charging these pesky fees?

People who work in financial institutions respond to these complaints with a small, tired smile, because the banks are proactive.

They call customers unprompted to offer credit and discuss portfolio opportunities. They say "we noticed you have some idle balances; have you considered this exotic financial instrument..."

The caveat, of course, is that they only do it for their high-net-worth customers. This is, more or less, private banking/priority banking or whatever the bank calls the tier of account above yours.

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The complaint, translated, is not really "banks are not proactive." It is "I am not rich enough for my bank to be proactive about me."

Which is fair! But it frames the whole thing as a service failure, when it might be better understood as a glimpse at a product you'd have to pay for.

Anyway, UBA is being proactive. BusinessDay reports:

United Bank for Africa (UBA) is offering its customers personal loans of up to N30 million to invest in the ongoing Dangote Petroleum Refinery initial public offering (IPO)… The offer was disclosed in an email sent by the bank to its customers, highlighting the facility as a way for investors who need additional funds to participate in the IPO.

“Want to invest in the Dangote Refinery IPO but need extra funds? Get up to N30 million with the UBA Personal Loan,” the bank said.

---

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Anyway, when you click through to the details of UBA’s loan, here’s what you find:

Maximum loan amount of ₦30 million and minimum of ₦200,000 … convenient repayment period of 60 months … one-off management fee of 1%. Requirements: a functional savings or current salary account with UBA; employer on the bank’s approved organisations list; confirmed staff of your organisation; maximum borrowing up to 60% of your debt service ratio.

It's pretty much a personal loan secured against your salary rather than the shares. Your qualification will depend on your salary and credit history as usual, so this isn’t the proactive/innovative offering UBA has made it out to be.

The bank was always willing to lend you this money; the IPO is just this month's costume.

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Fixed and Fibre

This week, in my quest for truly uninterrupted internet, I added MTN’s FlyX, an outdoor 5G router, to my existing Starlink connection.

This kind of internet stack is common among Nigerians who work remotely. Some people will use FibreOne and MTN, Spectranet and FibreX—you get the drift. No serious person who wants to hold down a remote job for long relies on one connection.

A country where remote workers treat backup internet as basic equipment should be a great market for home broadband. Less than 1% of the country’s estimated 38.7 million households have any fibre connection; almost all of Nigeria’s 124.4 million broadband subscriptions in July were mobile lines.

It sent me down a rabbit hole of trying to understand the market.

Telcos never stopped investing

In 2016, when NCC fined MTN Nigeria ₦1.04 trillion over unregistered SIM cards, the telco invested over ₦196 billion in its network. It even kept spending through a second recession and the 2020 COVID pandemic.

Fast forward to 2024, and MTN spent ₦444 billion ($350m) on its network, up from ₦361 billion ($850m) two years earlier, with naira devaluation reducing the amount spent in dollar terms. Capital expenditure also fell to 13.2% of service revenue as the company posted a ₦400 billion loss.

The 50% tariff increase in 2025 gave MTN room to spend ₦1 trillion ($660m) on its network and another ₦620.5 billion ($400m) in the first half of this year. “Now that we’ve got a business case to make those investments, we will continue to make those investments,” Modupe Kadri, MTN Nigeria’s CFO, said in March.

The telcos zero in on homes

MTN has run a fibre-to-the-home business for about a decade, first branded MTN Fibre Broadband, before jazzing it up as FibreX in April 2025. For most of that decade, it had only a few thousand subscribers, even as mobile customers continued to grow annually.

The fibre-to-the-home business has been sluggish because for a long time, it made little commercial sense to telcos. When telcos spend money on mobile capacity, they reach millions of people who are already paying for data (data traffic was growing by more than 40% annually).

Fibre-to-the-home requires digging up a road to reach a few hundred homes, many of which may not pay ₦30,000 a month for the connection. Operators also pay right-of-way fees to lay cables and spend more money to fix cable cuts caused by road contractors and vandals. Next to the mobile business, the addressable market for home broadband is (but not for long!) a rounding error.

A fibre connection is the last in a chain of four networks. The first is international capacity, i.e., the submarine cables that connect Nigerian networks to the rest of the internet. At least eight submarine cable systems land in Nigeria, including MainOne, Glo-1, Equiano and 2Africa, so this end of it is pretty much solved.

From where those cables land, you need a national backbone to move internet capacity between cities; Nigeria’s existing capacity is roughly 35,000 kilometres, and Minister Bosun Tijani’s ambitious Project BRIDGE plans to add 90,000 kilometres to that.

The last two networks in the chain, metro fibre and fibre-to-home, are where Nigeria struggles. An operator laying fibre across Nigerian cities has to negotiate right-of-way fees with state governments.

Yaba’s emergence as a technology cluster was thanks in part to the Lagos state government’s agreement to waive right-of-way fees for MainOne to lay fibre in 2013.

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While the National Economic Council recommends that states charge ₦145 per metre for RoW fees, only 19 states comply with that recommendation. Many states are unwilling to give up such a sweet revenue source.

Ogun charges ₦6,600 per metre while Kano charges ₦2,754 before application and inspection fees. Telcos have cited these costs as a deterrent to fibre network expansion in Nigeria, but they’re now rethinking that stance because of demand patterns.

Starlink, the country’s second-largest internet service provider excluding the telcos, went from 11,207 subscribers in 2023 to 98,642 by June 2026. Almost 100k Nigerians are willing to pay ₦57,000 a month for internet that works; imagine the demand at something like half the price.

MTN’s FibreX (30k a month with free installation- not an ad!) grew from 89,441 subscribers in January this year to 176,468 by June, giving it 55% of a national fibre market of 319,735 connections. FiberOne, the next largest, has 56,486.

Cable cuts

The NCC recorded 27,685 fibre cuts in 2025 (roughly 76 a day), alongside 27,000 cases of operators being denied access to their sites and 4,210 thefts. Another 5,934 cuts were recorded in the first half of this year, most of them caused by road construction and excavation. MTN Nigeria CEO, Karl Toriola, claimed Nigeria records more fibre cuts in a day than Saudi Arabia records in a year.

Anyone looking to scale fibre to eight million homes must make their peace with the massive headache that will come with it.

Safaricom, with a large mobile-money business and a much older home-fibre operation, connects about half the homes its network passes. It had passed 807,016 Kenyan homes by March and connected 407,080 of them. At that conversion rate, eight million homes passed would mean four million connections, roughly ten times Nigeria’s entire home-broadband market today.

Consolidating at the top, fragmenting at the bottom

According to data from the NCC, 124 of the 148 licensed internet providers have fewer than 2,000 customers. 97 have fewer than 500 customers.

It’s tempting to conclude that smaller players should prioritise mergers. Merging three 800-subscriber ISPs gives you one 2,400-subscriber ISP that can share fixed costs. Curiously, the business models of the small ISPs suggest they want to remain small.

The typical small ISP is an estate business focusing on finding places where the last mile is short, and permission comes from one person, i.e., the estate developer. Once they have access to a cluster of residents and assurance that private security will protect their equipment, they’re fine. They’re not looking to go national.

That strategy may be working; 125 small providers added 47,400 subscribers between them in six months, and the NCC has licensed six new ISPs this year. The market is consolidating at the top and fragmenting at the bottom.

The government tried to solve this fragmentation problem at the bottom by licensing seven infrastructure companies to build open-access fibre networks across the country, but by the end of three years, none had become fully operational. Operators told BusinessDay that a promised ₦3 billion subsidy was not paid.

According to Aminu Maida, the NCC’s chief executive, “Nigeria has fibre across the states, but what we lack is a fair access market.” Existing routes are often owned by companies that built for themselves, with inconsistent pricing that makes it difficult for smaller providers to lease them.

There are cheaper ways to build the missing links into homes. Safaricom strings much of its feeder fibre on power poles, above the road crews responsible for most Nigerian fibre cuts. There’s no equivalent national framework that allows telecom operators to attach fibre to electricity distribution poles here. Nigeria has spent years agreeing what it should cost to dig but has paid less attention to whether every cable needs to be buried.

Two broadband plans, seven infrastructure licences and eight submarine cables have brought fibre within a few hundred metres of many Nigerian buildings. Getting into homes is an expensive undertaking that telcos have historically avoided; the clear commercial opportunities are now forcing them to make a big play for it.

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IPO Fever

I read the essay “Is This IPO Halal” this weekend, the latest in Feyi Fawehinmi’s long-running critique of Africa’s richest man. That scrutiny has produced some fantastic articles, and this one raises pertinent questions about the quality of research Nigeria’s investment banks are publishing for a transaction of this size.

My small disagreement is with one small part: the suggestion that the excitement reflects Nigerians’ fascination with Aliko Dangote, a man who pretty much gets whatever he wants.

Huge Initial Public Offerings (IPOs) capture public imagination anywhere. At the offer price, Dangote Refinery would be worth roughly ₦65 trillion, nearly three times Airtel Africa, currently the largest company on the Nigerian Exchange. For investment banks, there are fees to earn; for ordinary people like me, a spectacle to follow. That gives the company considerable leverage.

In April, the New York Times reported that Elon Musk demanded that banks seeking a role in SpaceX’s IPO buy subscriptions to Grok. Some banks agreed to spend tens of millions of dollars annually on the chatbot. He also asked them to advertise on X, although he was less insistent about that.

Walking away meant leaving a potentially enormous payday to another bank.

Index providers had a different problem: how long could they exclude an enormous new company before investors questioned whether their benchmarks still represented the market?

S&P Dow Jones Indices considered shortening the waiting period for IPOs from 12 months to six, and exempting really large companies from its profitability and minimum 10% public-float requirements. Nasdaq introduced a route to allow qualifying large listings into the Nasdaq-100 after just 15 trading days.

As Matt Levine wrote: “At some high enough valuation, you gotta defer to the market.”

In Nigeria, PenCom waived existence, profitability and dividend requirements for the Dangote Refinery IPO, citing its strategic importance and fundamentals. That could reflect the accommodation an unusually large issuer attracts. PenCom still owes retirement savers the assessment behind its decision.

Ultimately, with a sufficiently large offering, even established rules become negotiable.

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MTN’s fintech business

I’ve said a few times here that MTN Nigeria’s fintech business is basically airtime lending with a dash of mobile money. Its reporting puts both in the same revenue bucket, making it difficult to see how much each contributes.

This year, a dispute over applying the FCCPC’s consumer-lending rules to airtime advances interrupted the business. MTN suspended Xtratime in mid-April and began a phased restart in July.

MTN disagreed with the FCCPC’s definition of airtime lending as consumer loans, and the matter went to court. Before the court returned a decision, MTN suspended Xtratime, the said lending service.

This was bad news for customers who needed airtime and even worse news for MTN’s fintech revenue. But it was excellent news for nosy journalists who always wanted a look inside that fintech revenue bucket.

MTN Nigeria reported ₦64.2 billion in fintech revenue in the first quarter of 2026. With Xtratime suspended for most of the second quarter, that fell to ₦13 billion.

The remaining ₦13 billion is not all MoMo revenue, and Xtratime still operated for part of the quarter. Still, removing one product coincided with a four-fifths collapse in fintech revenue.

MoMo was growing throughout this as mobile-money revenue rose 132% year-on-year in the first half, and active wallets reached five million. The wider fintech category still recorded a 7.2% revenue decline.

The disruption even affected MTN Group’s outlook. It expects fintech revenue growth to remain below its medium-term target of roughly 30% as airtime lending in Nigeria rebuilds.

The dependence reaches beyond Nigeria as MTN Group expects fintech growth to remain below its medium-term target as it reintroduces Nigerian airtime advances.

There is nothing embarrassing about airtime lending, and it is a very good business. Many fintechs would kill for a lending business where the risks of default are tiny and said risk sits with a third party.

But a highly profitable lending product built on your telecom network is a different proposition from a mobile-money business that can compete with OPay, PalmPay or Moniepoint.

A MoMo question

At the end of March, MoMo had 3.3 million active wallets and ₦18.9 billion in customer deposits. By June, active wallets had risen to five million, but deposits had fallen to ₦14 billion.

That works out to roughly ₦5,700 in deposits per active wallet in March and ₦2,800 in June. It is a rough ratio, but it basically shows that more active wallets have also coincided with less money on the platform.

Are customers keeping smaller balances while transacting more, or using MoMo only occasionally?

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In the beginning was Taxi Park

The news of Uber’s exit from Nigeria has dominated conversations this week, and you’d be forgiven for thinking it was the first cab-hailing service in Nigeria. That distinction belongs to a startup called Taxi Park (later called Tranzit), which launched sometime in 2012 at a time when TechCabal used to write snazzy paragraphs like this:

“Ironically, I quickly dismissed it [Taxi Park] as crud at the time. Partly because it was being pitched by one of its founders, whose SMS/BBM style of writing made him seem barely literate…Right off the bat, they were asking for my phone number, and I remember thinking “hey I just got here, the fuck do you want my phone number for?”

Bring back that TechCabal.

By 2013, more ride-hailing startups were springing up. There was the Rocket Internet-backed Easy Taxi, Afrocab, Taxipixi and Saytaxi.

Most of the apps worked roughly the same way. They recruited drivers, trained them on how to use smartphones and maps, matched them to trips, and collected a commission. Easy Taxi charged drivers 10% and, in its early days, gave them smartphones.

Given where smartphone and internet penetration were at the time, you could also hail some of these services through SMS.

When the first signs that Uber would launch in Lagos, the “Vegas of Africa,” were visible by April of 2014, the existing ride-hailing players welcomed the challenge.

“The beautiful thing about competition is that it prevents you from being complacent and forces you to continue innovating,” said Bankole Cardoso of Easy Taxi. Taxi Park’s co-founder Nicole Ugbomeh was even open to collaboration. “We think working with Uber could be beneficial to both parties.”

Nigeria had just rebased its GDP to about $500 billion, overtaking South Africa as the continent’s largest economy. Lagos felt like a city in which almost anything could work.

Despite this optimism, the funding gap would have worried Uber’s competitors. By April 2014, Uber had already raised about $307 million, and by the time it launched in Lagos, it raised another $1.2 billion. Easy Taxi had raised around $37 million globally at the time, while Tranzit’s funding was somewhere in the region of $300k.

While it was great to be so flush with cash, Uber’s main advantage was that it understood that the ride-hailing product was not really the app, but how quickly a decent car showed up. While Easy Taxi and Tranzit spent years recruiting taxi drivers and trying to bring them online, Uber was looking to make a driver out of everyone with a really nice car. It was paying bonuses to existing drivers when they referred new drivers to sign up. Those new drivers earned ₦40,000 once they completed forty trips.

Uber began in Lagos with the expensive UberBlack: SUVs and new-ish cars for customers willing to pay a premium. In December 2014, it introduced the mass-market UberX and began relentlessly wooing customers.

New users got ₦5,000 first-ride credits, and the ride-hailing company attached itself to events and corporate partnerships. The fancy foreign app was now coming down the price curve to meet everyone else.

Beyond the customer incentives, Uber’s early decision to build a community around its drivers was brilliant. It held sessions and lunches where drivers could meet the Lagos team, ask questions, complain, and hear about changes to the service. It also called them “driver-partners,” language that would become meaningless once the economics of the business changed.

That community provided a steady source of feedback about riders and what was happening on Lagos roads while making drivers feel invested in the company’s success. People who had joined to earn money were soon convincing friends to sign up and defending Uber as though they had joined a movement.

Uber initially charged Lagos drivers a 20% commission, twice Easy Taxi’s rate, and by the middle of 2016, it jacked the commission to 25%. Yet drivers didn’t complain because Uber offered enough trips and bonuses to offset the commission.

By July 2016, two years after launch, Uber had completed more than one million trips in Lagos. Its millionth trip, from Yaba to Lekki, happened on July 16.

Its march to dominance was not without stumbles; Uber launched with card payments only, an important part of the Uber experience globally. But Uber’s merchant accounts were outside Nigeria, so local banks treated rides as international transactions.

As Nigeria’s foreign-exchange crisis worsened in late 2015, some riders were charged more than 20% above the fare shown in the app, while others reported double debits.

In January 2016, Uber began experimenting with cash payments in Lagos and partnered with Paga to accept local cards. Cash brought many more Nigerians within reach of the service, but complicated Uber’s otherwise clean model. Drivers would collect the entire fare, including Uber’s commission, which the company had to deduct from their subsequent card earnings. It was inelegant, but it worked.

By this time, the competition Uber met in the market was fading into the horizon. Easy Taxi left Africa in April 2016 while Tranzit’s public trail simply went cold. The companies had their own problems, but Uber had read the market better and knew that this was about who could put the most and best cars on the road.

Yet as the market began to change, Uber stopped adapting and made strategic missteps that allowed Bolt, and later inDrive, to trounce it.

On Monday, May 8, 2017, Uber driver switched off their apps and drove to the company’s office in Lekki to protest a decision to cut Lagos fares by 40% in response to a price reduction by the increasingly popular Taxify. Drivers, who Uber had courted for years, were not consulted.

The cut exposed how little the word “partner” meant. Uber still took 25% of every fare, while Taxify took 15%. Drivers organised through WhatsApp groups and began moving to Taxify in their hundreds.

Taxify didn’t care about loyalty or exclusivity; it only needed to make trips more attractive on its platform than on Uber. Drivers could keep both apps open and accept whichever request paid better; as more of them chose Taxify, Uber’s wait times rose and riders followed. Taxify was using the same supply advantage Uber had once used against Easy Taxi and Tranzit.

Two months later, Uber tried to repair the relationship by opening a large driver-support centre in Maryland, promising drivers “a voice and a choice.” But the relationship had become increasingly one-way, and by 2020, a drivers’ union accused Uber of avoiding repeated meetings over pricing, safety and regulation.

Uber also squandered its momentum by moving too slowly outside Lagos and Abuja. In December 2020, Bolt launched in ten Nigerian cities at once, taking its total to 21. Uber, which had arrived two years earlier, was still only in Lagos, Abuja and Benin City.

Bolt was operating in 33 cities by 2025, and was, according to Sensor Tower, Nigeria’s most-downloaded travel and mobility app. There is no public breakdown of trips or revenue that gives us a neat final score, but Uber no longer set the pace.

Uber did not get chased out by some uniquely Nigerian hostility; instead, it spent years losing relevance through strategic missteps.

The manner of its exit completed the journey from driver-partners to disposable suppliers. The company gave no warning, with drivers learning of the shutdown in real time as some riders received the notice while they were still in an Uber.

Twelve years after inviting drivers to lunches and promising them a seat at the table, Uber did not even tell them the table was being cleared.

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Moove-ing On

Moove is considering closing its Nigerian business and handing around 3,000 drivers ownership of their cars before they have finished paying for them, two people close to the situation told Notadeepdive.

The options being considered include reducing their outstanding balances to a level that would allow early ownership transfer, or waiving the remaining payments entirely. It is unclear how many of the drivers still have outstanding payments.

Moove did not respond to a request for comments.

The deliberations preceded Uber’s exit from Nigeria this week, those people said. Despite Uber’s abrupt announcement and immediate exit (some riders and drivers learned about the shutdown while trips were still underway), two people with knowledge of the process said the decision to leave was made several weeks ago.

Moove, which became a unicorn last month, financed the now-famous tiny Suzuki cars used by many Uber drivers. It solved an important problem for Uber by adding drivers who could not afford to buy cars.

On Thursday, Technext reported that Moove would allow its drivers to work for Bolt and inDrive.

That could keep the drivers earning while Moove decides whether to wind down the business, but it would not automatically recreate the system behind its arrangement with Uber. Uber’s trip data helped Moove assess and monitor drivers, while its payments integration allowed Moove to collect repayments directly from their earnings.

Without equivalent integrations with Bolt and inDrive, Moove would need another way to collect from thousands of drivers every week. That makes handing over the cars a practical option.

In 2023, TechCabal reported that Moove drivers paid ₦56,604 weekly for four years, amounting to ₦11.77 million in scheduled payments at an annual interest rate of 8.9%.

If all 3,000 drivers have between one and two years remaining and are still on those terms—both large assumptions—a crude calculation puts their outstanding scheduled payments at between ₦8.8 billion and ₦17.7 billion.

The payments also cover insurance, maintenance and other services it would stop providing once ownership transfers, and the contracts have changed over time.

Moove must compare the financing portion of those remaining payments with the cost of continuing to service the cars and collect every week. Its other option is to recover the cars from drivers, store them and find buyers willing to pay enough to make the exercise worthwhile.

When Lagos restricted commercial motorcycles in February 2020, OPay began moving ORide away from passenger trips and towards deliveries. The company reportedly had around 8,000 motorcycles and planned to sell half of them for between ₦180,000 and ₦270,000 each. Individuals and logistics companies quickly began buying them.

Moove faces a harder version of that problem because repossessing and selling thousands of used Suzuki cars would take considerably more time and money. For the drivers, receiving the cars early would be unusually generous, but for Moove, it may be cheaper than collecting everything it is owed.

The company also no longer resembles the vehicle-financing startup that launched in Nigeria. It is valued at $2.1 billion and operates across several markets. It is also building infrastructure for autonomous fleets like Waymo.

Its Nigeria has nevertheless shown the limits of the original model.

When Moove launched, the naira was more stable, and drivers could more easily cover weekly payments and living expenses. As the naira weakened and the cost of cars and fuel rose sharply, drivers’ earnings were declining. Uber could not raise fares indefinitely because its customers were suffering a cost-of-living crisis, yet Moove still needed drivers’ repayments to cover the cost of the cars it had financed.

Moove put thousands of cars on the road for people who could not otherwise afford them and created earning opportunities. But creating work and car ownership turned out to be two different problems.

While Moove considers exiting, Future Africa remains keen on the mobility space. The firm was one of Moove’s early investor, initially putting in a little over $100,000 before investing considerably more, one person with knowledge of the investment said.

It has since sold part of its stake and taken some money off the table, even as it invested in Moove’s latest round through another vehicle. Future Africa is also backing another Nigeria-focused mobility startup that remains in stealth, according to people with knowledge of the situation.

If Moove waives the remaining payments, thousands of drivers will own their cars earlier than expected. It would be a generous outcome for them, but it would also show how badly the economics have deteriorated. What Moove is still owed may no longer be worth the trouble of collecting it.

See you on Sunday!

*An earlier version of this newsletter claimed Future Africa was Moove's first institutional investor. That claim has now been clarified.

If you missed Friday’s Notadeepdive, catch up here.

Ride-hailing company Uber will begin winding down its Nigerian business today, ending a 12-year operation in the country. The decision to wind down Nigerian operations is connected to broader layoffs in the business, which affected 3,300 people, approximately 10% of its headcount.

The ride-sharing giant is reducing the number of teams with one or two members by 50%, and letting go of staff who are “more than seven layers down from the CEO,” per Bloomberg.

It will also drastically reduce remote roles, allowing less than 1% of its staff to work remotely.

“We are writing to share some difficult news. After a thorough review of the business, we have made the tough decision to wind down our operations in Nigeria.”

Uber launched in Nigeria in 2014 as one of the first foreign ride-hailing operations in the country, adapting its model to accommodate cash payments, bucking the usual trend of card payments in other geographies.

For a while, it set the pace for ride-hailing, holding a specific standard for cars, drivers, and even passengers. Yet, the e-hailing space soon became a race to the bottom.

The Estonian firm Bolt (formerly Taxify) launched in 2016 and was keen to win market share. It began a brutal price war with Uber, and even relaxed standards for cars and drivers in the space.

While Uber initially treated ride-hailing as some semi-luxurious service, Bolt rightly viewed it as a commodity for Nigeria’s thin middle class. This difference in thinking would eventually allow Bolt to have some 20,000 active cars in Nigeria, some 60% of the market share.

Other entrants like In-Drive hastened a race to the bottom for the ride-hailing space, with an interesting model that allowed passengers and drivers to haggle over prices. They also relaxed car specifications, essentially recognising that many users didn’t care too much about the make of the cars.

To be fair, Uber also realised the commodification of the space and responded with Uber Go, a cheaper alternative that used tiny Suzuki cars financed by Uber. As a solution to a car supply problem, it was brilliant.

In reality, a naira devaluation meant that Moove, which raised dollar financing to buy those Suzukis, would need drivers to pay more money if it was not to end up holding the wrong end of the deal. Inflation also narrowed the pool of people who could pay for private rides.

Perhaps more importantly, the leading ride-hailing services remained reluctant to lower their commission from 15-20% per ride, forcing drivers to forego loyalty to any one platform.

Drivers became experts at teasing out what platforms would pay the most for trips and simply went with the best offering. Uber and Bolt eventually increased base fares after Nigeria ended fuel subsidies and fuel prices tripled.

Ironically, Uber had driver loyalty in Nigeria when it began operations and used community as a way to earn loyalty. Yet, drivers felt disenfranchised as the business went on and often protested that they were no longer at the decision-making table at Uber and Bolt.

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OPay’s Cheap Deposits

If you missed Friday’s Notadeepdive, catch up.

Around here, I often say that lending is easy and that you need cheap money to make it work. If you don’t have ₦1 billion sitting idly in a bank account or under your pillow, you want someone else’s money at almost no cost.

So if you get money at 35% interest, you must charge considerably more than 35% because you need to account for bad loans and the cost of running the business. It ‘s already so expensive that it will likely not work.

What if you had a bank? Customers will leave money in current and savings accounts, and regardless of the ads, you’ll pay them little or nothing for it. You can take some of those deposits and lend them at much higher rates (this is extremely simplistic but you get the point). The more deposits banks/fintechs attract, the less they depend on expensive borrowing to fund loans.

In 2025, OPay’s customer deposits soared from $244.2 million in 2024 to $705 million, roughly ₦1 trillion. Its deposit base is already roughly one-third the size of Sterling or Wema Bank.

These deposit figures have not previously been reported.

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How much did all of customer deposits cost OPay? The company reported only $2 million in total interest expense in 2025, up slightly from $1.9 million a year earlier, even as customer deposits almost tripled.

We cannot tease out the exact cost of these deposits because the financial statements don’t show how much of that interest expense was paid to depositors or at what point in the year the deposits arrived.

What we know is that as customer deposits increased by $460.8 million in 2025, cash and short-term investments rose by almost the same amount. The close match suggests that OPay kept most of its money in liquid assets rather than lending it out (hello there, GTCO).

The financial statements do not explain why deposits grew so quickly, but we can take a stab in the dark and ascribe it to OPay’s payments business. People receive transfers, merchants collect payments, and customers pay bills inside the app. Some of that money remains in the app, while OPay’s interest-paying product (O’Wealth) gives customers another reason not to move it.

Beneath these deposits sat another $1.03 billion in redeemable convertible preferred shares supplied by investors.

These shares can be converted into ordinary equity, while their redemption provisions may eventually require OPay to repay the investors. In 2025, their carrying value increased by $89.5 million through accretion, an accounting adjustment that moves the balance towards its redemption value.

The accretion did not reduce OPay’s $72.5 million net income or require an $89.5 million cash payment that year. It was instead deducted when calculating the result attributable to ordinary shareholders. After the deduction, OPay reported a $17 million loss attributable to them.

OPay therefore has two different funding advantages. Customer deposits provide a large supply of extremely cheap money. The preferred shares provide a substantial layer of investor capital beneath the company’s liabilities. OPay could keep much of the new funding in liquid investments, earn $47.3 million of interest from them and operate a growing loan book without relying heavily on expensive borrowing.

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Lending is easy

On Notadeepdive, I frequently say that lending is easy. Once you find a source of funding (preferably customer deposits), a few hundred people will be milling around your app, trying to get a loan before the end of the day. While the Nigerian saying is that garri doesn’t need advertising, I think the more accurate version is that personal loans don’t need ads.

Unsecured personal loans, a.k.a. loans without collateral, are popular for fairly obvious reasons. You could be one week from payday and desperately need money. Or you could be trying to complete the money for an unexpected purchase, like replacing the phone someone stole from you at the bus stop.

According to CRC Credit Bureau’s 2025 report, the average Nigerian consumer loan is about ₦136,000 ($89). The average individual American loan account carried a balance of $8,437.

Anyway, lending is easy, but you only stay in business when you can get the money back.

American lenders can consider a borrower’s income, existing debts, credit score, years of information about mortgages, credit cards, car loans, and missed payments. Even then, a loan is an educated guess about what the borrower will do next, and a wrong guess is expensive. In America, the borrower’s incentive to repay is tied to their credit score.

In Nigeria, a Bank Verification Number can confirm a borrower’s identity, and bank statements can show cash flow or salary. But neither reveals the borrower’s existing debts or their willingness to repay an unsecured loan.

And while Nigeria has three credit bureaus, their records are not always identical, so lenders often need to check at least two to get a fuller picture. Many digital lenders also do not consistently report their loans, so “smart” borrowers can owe several lenders while each one sees only part of the problem.

OPay’s $121 million school fees

OPay’s headline numbers have made the rounds in the past week, and I’ve been dying to see its consolidated financial statements. The numbers floating around are not as impactful without seeing the full picture. Thankfully, that bit of mischief has now been managed.

OPay sharply increased loan disbursements between 2024 and 2025, with $938.3 million in new loans in 2025. Unless you have some magic formula that no one else in lending has, that kind of growth will come with loan defaults.

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While OPay’s revenue more than doubled in 2025, its provision for expected credit losses nearly quintupled. For every dollar of revenue, OPay booked roughly 23 cents in expected credit losses, up from 12 cents the previous year.

Even with millions of active customers and visibility over their spending patterns, OPay is simply offering customers small loans and watching what happens. They then adjust the next offer based on borrower behaviour.

It’s hard to blame them because transaction data says little to nothing about willingness to repay. It also doesn’t tell you if a borrower is repaying just so they can look reliable until the limit increases to an amount that is substantial enough for them to risk “running away with.”

OPay still made $72.5 million in profit in 2025 (look away now, Jumia), which gives it room, for now, to absorb the defaults that come with growing its lending business this quickly.

In a Notadeepdive edition from last October, I described FairMoney’s success in similar terms. It burnt cash learning who would repay, then lowered its cost of funds until the maths worked.

In 2024, FairMoney generated ₦121.9 billion in revenue and made ₦7.9 billion in profit. It also recorded ₦59.4 billion in impairments on loans and other assets.

FairMoney charged enough interest to absorb those impairments, learnt from millions of loan applications, and eventually funded more of its lending with customer deposits instead of expensive investor capital and debt.

There is no version of mass-market unsecured lending where everyone pays because underwriting is a series of guesses. The lender records which ones were wrong and prices the next batch so that the good loans pay for the bad ones.

OPay’s $121.3 million provision is part of the cost of learning which borrowers will repay. It originated almost $1 billion in new loans, made room for a large number of bad ones, and still made $72.5 million.

That is a lot of school fees, but OPay can afford them.

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Retreat

During the 2020 and 2021 funding boom, fundraising rounds were frequently followed by expansion announcements. In that era of abundance, your startup story had to be expansive; there’s nothing that excites investors more than the idea that you’re pursuing a continental opportunity.

Expansion also allowed you to “derisk your Nigerian business” as promised in many a pitch deck. Multiple countries could reduce dependence on the naira and the Nigerian economy, and if your product could reach Nigerian users in the diaspora, even better.

Expansion became another step in the playbook, often without rigorous questions about what would allow the company to succeed in those new markets.

At its peak, Jumia was in Rwanda, Cameroon, and Tanzania, which in hindsight sounds quite ridiculous. It exited those markets once it became a serious company.

One of the ironies of Nigeria being a difficult market is that it can build exceptional operational ability while creating a company perfectly adapted to Nigeria.

A Nigerian fintech, for example, has to juggle painful integrations with banks and wicked regulators. It must combine a deep knowledge about how Nigerians move money with the deftness required for black swan events like the 2023 cash crunch.

As the fintech expands, it will need to build new relationships and adapt to customer behaviour that is forever changing, forcing it to become a second startup in every new country.

Globacom expanded to Ghana, but its Nigerian network effects meant nothing to Ghanaian subscribers, who already had established expectations about coverage. After ten years, Globacom could only win 2% market share.

Sometimes demand is not enough

When Vendease entered Ghana in 2023, it claimed that weekly demand sometimes exceeded $1 million. But it could fulfil only about a quarter of those orders because it needed local funding. Its Ghanaian ambitions lasted one year.

Vendease supplied restaurants that often ordered food items without immediately paying for them. So the faster orders grew, the more money Vendease would have needed to meet working capital requirements.

The logistics startup, Kobo360, often paid truck owners upfront while its large corporate clients would pay 30 to 90 days later. While this problem remained unsolved, it raised $79 million and expanded into Ghana, Kenya, and other African markets.

The financing weakness that plagued its Nigeria business was replicated in every new country, and when credit and venture funding tightened, the system stopped working.

The concierge startup, Eden Life’s Kenya expansion followed its acquisition of Lynk in 2022, but by 2026, it had paused consumer operations in Kenya and Nigeria after the economics of the consumer home-services model simply didn’t work.

Olawale Ajai’s study of failed Africa-to-Africa expansions found that organisational and strategic weaknesses explained failure better than host-country conditions. Companies often explain new market failures with regulation and consumer behaviour, obscuring the possibility that the original decision to enter said markets may have been affected by insufficient local knowledge or managerial capacity.

African institutional investors interviewed for a 2025 study shared that the incentives for managers to expand did not always align with shareholder interests. Managers may gain status from leading a multinational company even when shareholders receive poor returns.

Yet the evidence is imperfect. Most studies interview companies that successfully became international, while failed subsidiaries disappear and their executives move on. One Nigerian banking study used only 25 observations and could not establish whether expansion improved profitability or whether profitable banks were simply better able to expand. Existing research is better at explaining the courage to enter than the returns after entry.

Advantages don’t always travel

This week, Moniepoint announced it would phase out MonieWorld, the UK remittance product it spoke about confidently last year.

Remittances promised foreign-currency revenue from a large Nigerian diaspora; cue that joke about shaking any tree and Africa-focused remittance companies falling out of it.

For a company of Moniepoint’s size and reputation, few people entertained the possibility that this expansion could fail but big companies fail at new things all the time.

The reporting since Moniepoint’s announcement has coalesced around how MonieWorld was growing in a difficult market and how we need to applaud the company for trying.

Those publications also cited Moniepoint’s claim of transaction-volume growth as proof that Moniepoint didn’t ditch this product because it wasn’t growing. But transaction volume growth alone tells us very little because a business can grow quickly from an irrelevant base and you can juice transaction volume with freebies.

In counting the cost, Moniepoint’s UK entity reported no revenue and lost about £1 million while the remittance product was being built in 2024. It also allotted £5.9 million in share capital to the entity and later acquired Bancom, an electronic-money institution, to obtain the necessary licence.

So we know that Moniepoint already spent heavily before launch and that sixteen months later, it could not justify continuing.

Kuda traveled down the same remittance road three years earlier.

Whatever happened to Kuda’s first remittance business?

Kuda launched a UK-to-Nigeria remittance product in 2022 through Kuda EMI Ltd, a dedicated British entity.

In 2022 and 2023, Kuda EMI recorded total revenue of £634 (yes, you read that right) while its direct costs were £252,157. Its cumulative losses over the two years reached £982,510.

Kuda has since relaunched another cross-border product built with a different structure, and it remains to be seen whether that attempt will work.

Kuda MFB, the Nigerian business, reported more than 300 million transactions worth ₦14.3 trillion in the first quarter of 2025 alone.

Increasingly, Nigerian technology companies establish offices and add countries to their maps, but their income statements remain overwhelmingly Nigerian.

Interswitch has operations across several countries, but generated about 90% of its 2025 revenue from Nigeria. That was an improvement from 94% a year earlier. You can’t describe Interswitch as a genuinely pan-African company by revenue.

OPay operates in Nigeria, Egypt, Indonesia and Pakistan but Nigeria contributed 88% of its 2025 revenue.

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Why the banks eventually fared better

Nigerian banks are an exception to the struggles of international expansion. UBA reported that operations outside Nigeria generated 51.7% of group revenue in 2024. Access said its foreign banking subsidiaries produced 65% of its banking group’s profit before tax in the first half of 2025. About 35% of GTCO’s 2025 revenue came from outside Nigeria.

It took the banks roughly two decades to get there; they’ve been helped along the way by local deposits. A startup will use investor equity from the parent company to finance recurring foreign working-capital needs, while a bank can raise deposits in the country where it lends. Its assets and liabilities can grow in the same currency.

Banks don’t always begin with the expensive task of persuading millions of unfamiliar retail customers to adopt a new product. Despite these advantages, their progress was hardly frictionless.

Diamond Bank built businesses in Benin, Togo, Senegal and Côte d’Ivoire. Its main West African subsidiary was profitable in 2016, earning ₦911 million after tax, but that profit sat on more than ₦401 billion of assets, a very thin return for a parent bank that needed capital at home. Diamond sold the businesses and later gave up its international banking licence.

A foreign subsidiary can be profitable and still be a bad use of group capital. Banking regulators also ring-fence local capital and liquidity, which means money in one subsidiary cannot always be pulled home when the parent needs it.

The banks eventually found a model that travelled, but only after acquisitions, recapitalisations, exits and years of learning. Their present success should not erase the failed experiments that produced it.

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Interswitch’s Revenue is Surging

For a mature business, Interswitch is one of Africa’s fastest-growing technology companies. Last year, its revenue topped ₦100 billion for the first time, driven by an incredible 50% annual growth, according to its most recent financial report for the fiscal year ended March 2025. And over the last five years, gross revenue at the Nigerian payments company has surged fourfold, from ₦39 billion in 2021 to ₦137.5 billion last year. Interswitch is recording an impressive run thanks to the growing adoption of digital payments in Africa, notably in Nigeria, which accounts for 90% of its revenue.

Founded in 2002, Interswitch is one of the pioneers of digital payments in Nigeria. For years, Interswitch’s bread and butter was providing switching and transaction processing infrastructure to banks and enterprises, internally branded as Purepay. Now, a growing share of its business comes from retail services, particularly Verve, its card network scheme, dubbed Paytoken internally, according to its financial statements.

Like Mastercard and Visa, Verve cards are issued by banks and consumer-facing fintechs to customers, while Interswitch takes a small cut on all transactions done with the card. First launched in the early 2010s, Verve is offered in a number of African countries, and partnerships with international platforms like Capital One’s Discover enable cardholders to make payments abroad.

Interswitch operates other direct-to-consumer financial services through the QuickTeller and M-Kudi mobile money brands. And, as expected of every Nigerian fintech, the company also sells airtime recharge and bulk telecom texting products.

Over the last decade, Verve has been the standout performer with sustained growth. It now represents 32% of Interswitch’s gross revenues, with year-on-year card revenue rising 39% by March 2025. On the one hand, Verve is benefiting from the faster adoption of card payments in Nigeria, a process that has taken more than two decades to reach critical mass. On the other hand, Nigeria’s challenging macroeconomic environment, especially exchange rate volatility in recent years, has discouraged financial institutions from issuing foreign cards, such as Visa and Mastercard, to manage dollar-related costs.

The size of the domestic market is also fueling Interswitch’s growth. The number of Nigerian adults who have access to financial services has jumped to over 64% or 111 million, up from 40 million in 2020, according to think tank Enhancing Financial Innovation & Access (EFInA). This is thanks to the rapid advancement of mobile payment solutions by merchants and customers. While fintechs like OPay and Moniepoint race for dominance over peer-to-peer and merchant payments, Interswitch has primarily positioned itself as an infrastructure provider to power the real-time payments and debit card issuing needs of these companies.

In 2024, the total value of the country’s electronic retail payments, which includes merchant and peer-to-peer transfers, reached ₦1.1 quadrillion, as I predicted a year earlier, according to data from NIBSS. That figure is three times the size of the Nigerian economy. To put this in perspective, US retail electronic payments represent only a third of its GDP. Interswitch now “processes more than 90% of Nigeria’s card and mobile money transactions”, according to LeapFrog Investments, which acquired a stake in the business in 2022. Interswitch doesn’t disclose its own payments data in its financial reports.

As a result of these good fortunes, Interswitch’s profit margin widened to 11% in fiscal year 2025, its first double-digit earnings since 2022, before the naira significantly depreciated against the dollar.

Despite its run of positive results, Interswitch continues to struggle with rising costs. Its administrative expenses, which include salaries and other operating bills, are growing much faster than its revenue. Costs have ballooned from ₦26.3 billion in 2021, representing 67% of revenue, to ₦96.2 billion (or 70% of revenue) in 2025, which itself was a 43% increase from the previous year. Interestingly, the company is incurring an ever-growing bill despite moderate staffing increases. For example, in 2025, its total workforce rose 16%, but salary expenses alone surged 78%.

Even more crucial, Nigeria’s inflationary environment is hurting Interswitch’s top-line performance. While the company has achieved average revenue growth of 30% over the last six years, inflation-adjusted annual revenue for the same period grew at a mere 9%

Its investors have already priced in these challenges. In 2022, when Interswitch announced a $110 million investment from Tana Africa and LeapFrog, the round valued the company at $750 million, a 25% discount from 2019, when it raised at $1 billion, according to data from PitchBook, the market intelligence platform. Neither Interswitch nor its investors disclosed the company’s valuation at the time. But PitchBook’s figure is a highly reliable proxy. Perhaps that discount was due to Nigeria’s exchange rate decline, which has only worsened in subsequent years. However, this doesn’t tell the full story.

In 2019, Interswitch’s $1 billion valuation implied it was worth ₦306 billion in local currency terms at the time. Put differently, the fintech was valued at 11 times, or 11x, its fiscal year 2019 revenue. Revenue multiple is one approach to valuing a business, especially one that is witnessing high growth but has inconsistent profits.

Following the 2022 investment from LeapFrog and Tana, Interswitch’s revised $750 million valuation implied its naira market value had actually remained relatively flat at ₦315 billion, suggesting a multiple compression to just 6x its revenue for fiscal year 2022. The prevailing exchange rate at the time was ~₦421 to a dollar. Although Interswitch’s revenue had grown substantially between 2019 and 2022, the new investors were only willing to pay 6x for each naira of that revenue compared to the 11x investors paid in 2019.

Applying that 6x multiple to Interswitch’s fiscal year 2025 revenue (₦138 billion) would yield an ₦825 billion valuation — a massive jump — or just $611 million due to Nigeria’s significantly beaten-down exchange rate of ₦1,350 as of today.

The double whammy of devaluation and a challenging inflationary environment in Nigeria may have made it difficult to reprice the company upwards to account for its objectively faster growth rate. At an 11x multiple, Interswitch’s fiscal year 2022 revenue would have put its valuation at ~$1.4 billion.

Nevertheless, that round priced the fintech at a discount, even compared to the trading multiples of its peers like Visa (15x), Mastercard (16x), and even Adyen (32x) at the time. But at least it was better than the downtrodden PayPal (3x), which continues to be the sick man of the global payments market. In addition, Interswitch’s latest valuation puts it significantly lower than younger fintechs like Flutterwave and Moniepoint, valued at $3.3 billion and $1.4 billion, according to PitchBook data from each company’s most recent funding round.

Elsewhere, Norway-based browser company Opera valued its 9.5% stake in Nigeria-based OPay at $294.6 million at the end of 2025, according to its financial statement filed with the US SEC. This implies that OPay’s valuation now stands at $3.1 billion, a 13% jump from its fair value in 2024. Eight-year-old OPay, which is backed by several major Chinese investors, is on track to go public later this year after hiring Citigroup, Deutsche Bank, and JPMorgan Chase for its planned stock market debut at a ~$4 billion valuation, according to Bloomberg. Interswitch, on the other hand, has remained majority-owned by UK-based PE firm Helios Investment Partners since 2010.

Going forward, Interswitch’s focus appears to be on revenue growth by reinforcing its core business and expanding into new areas over the next few years, especially in non-Nigerian markets, which represented 10% of total revenue in 2025, up from 6% one year earlier. The company is stepping up its presence across the continent through a seven-year partnership with Nebraska-based fintech, ACI Worldwide, to sell ACI’s payment services, including real-time infrastructure, in 32 Sub-Saharan African countries.

As Nigeria’s fintech market grows and inflation decelerates, Interswitch is poised to benefit as long as it brings costs under control.

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Connecting the banks

At some point in October 2003, someone put a UBA card into a First Bank ATM and withdrew ₦1,000.

Today, that sounds unremarkable, but it took nearly twenty years of engineering and an unusual act of cooperation among rival banks to make it possible.

In 2002, Nigeria had roughly 90 banks, 68 ATMs and 1,800 POS terminals. A transfer took three days, and many banks could not connect to their own branches, let alone another bank’s network.

The accepted Interswitch story begins with Mitchell Elegbe and an ATM in Scotland. Our episode goes further back: to TCASS and Telnet, the engineers who connected Nigeria’s first bank branches, seven banks that invested ₦200 million, and a cap table designed to solve a trust problem.

Nnanna Ijezie and I spent months reconstructing the story.

Africa Built: The Interswitch Story

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Break-even*

In late 2022, there were few jobs with a clearer KPI than running Jumia. Co-CEOs Jeremy Hodara and Sacha Poignonnec had just left after three years of promising and failing to deliver on profitability.

Profitability offered Jumia the best route to repairing the “Amazon of Africa” narrative after fraud allegations damaged its credibility in 2019. It did not come close, not even during the COVID-19-fueled e-commerce boom.

In 2021, after Jumia’s share price unexpectedly spiked to $65, it sold into the enthusiasm, raising $573 million across two share sales, more than twice what it had raised around its IPO.

Suddenly flush with cash, Jumia decided to spend its way to the customer and order growth shareholders wanted to see.

Sure enough, it grew active customers and the number of orders, but it was a pyrrhic victory. Operating loss reached $240.9 million in 2021, and its net loss in 2022 was $238.3 million.

I wrote in July 2026:

“There is a pattern here of Jumia becoming disciplined when its back is against the wall. When money is scarce, it cuts employees, closes businesses, exits markets and discovers efficiency. When money is abundant, it has historically found new ways to spend it. That is the context in which Dufay’s latest profitability promise should be understood.”

On this week’s second-quarter earnings call, Francis Dufay, who took the KPI-heavy job in November 2022, reiterated the promise of “Q4 breakeven” six times.

He also highlighted an important decision:

“We deliberately chose to protect our margins and unit economics in this uncertain environment rather than chase GMV at the expense of profitability.”

On the equity fundraise, he shared:

“We also chose not to go for crazy amounts, right? I think the $50 million amount is useful for us. It strengthens the balance sheet. But we also try to be mindful of dilution for our shareholders.”

A better Jumia

Jumia employed 1,770 people at the end of June, down 59% from 4,318 when Dufay arrived. In Q2, technology costs fell 2%, while general and administrative expenses excluding share-based compensation fell 5%.

This is not merely a smaller Jumia. Revenue grew 14% to $52 million while operating loss narrowed 25% to $12.4 million.

After fulfilment, sales and advertising costs, Jumia retained approximately $1.98 per order, up from $1.79 a year ago. That still had to cover $9 million in technology costs and $15.2 million in general and administrative expenses. Breakeven will happen when the contribution from millions of orders can carry those largely fixed costs.

Doorstep delivery remains a minority service, with 75% of shipped packages fulfilled through pickup stations. Increasingly, Jumia looks like someone in Okene or Abakaliki ordering online, waiting a few days and collecting the package from a pickup station. As one Notadeepdive reader put it, Jumia is inventing post offices from first principles.

Advertising revenue, historically pitiable, rose 88% to $3.5 million; food delivery players must be on the sidelines taking notes.

Chinese and Turkish sellers sold 5.8 million items through Jumia during the quarter. They paid commissions and bought services such as warehousing, helping Jumia generate another $1.9 million in value-added services revenue.

Adding customers will not be enough. Jumia increasingly needs advertising, warehousing, and other marketplace services to become serious revenue engines.

THE REAL ORIGIN OF INTERSWITCH

In 2002, Nigeria had roughly 90 banks. 7 of them offered ATM services. The whole country had 68 ATMs and about 1,800 POS terminals for 120 million people, and a transfer took three days to settle.

In the third episode of Africa Built, we discuss the origins of Interswitch. This episode traces the company from the engineers who built Nigeria’s first bank networks in the 1980s to the December 2010 exit of the founding consortium.

Listen Now

Shifting the goalposts

Until February, Jumia’s published promise was loss-before-income-tax breakeven in Q4 2026, followed by full-year profitability in 2027.

It then made adjusted EBITDA its “primary profitability metric for guidance.” Q4 breakeven now means adjusted EBITDA breakeven; 2027 profitability means full-year adjusted EBITDA profitability. Jumia also added explicit positive-cash-flow targets for both periods.

The accounting hurdle became easier, and the cash-flow promise restores some of the rigour.

The distinction is worth $9.3 million; Jumia’s H1 2026 adjusted EBITDA loss was $19.4 million, against a $28.7 million loss before tax.

Jumia can therefore reach adjusted EBITDA breakeven while still reporting a statutory loss. The achievement would matter, but it would not be profit.

The profitability target was not the only one to move. Jumia cut its full-year GMV growth guidance from 27%–32% to 20%–30%, largely due to phones and electronics.

Phones account for 10%–20% of GMV, while other electronics account for slightly more than 20%.

A global shortage of memory chips and CPUs, compounded by disrupted Gulf air freight, has squeezed the roughly $100 smartphones common in Jumia’s markets and kept prices high. The old Jumia might have subsidised those phones to keep GMV looking good.

Phones and electronics are also among Jumia’s worst categories. Its take rate on smartphones is only 4%–6%, so a $200 phone produces very little revenue.

Twenty $10 household orders produce the same GMV, but more marketplace fees, advertising demand and opportunities for repeat purchases. The guidance cut exposes how much of Jumia’s historical scale came from a middling category.

The $50 million question

Jumia ended June with $48.3 million in liquidity after burning $14.3 million during the quarter. At that rate, it had approximately three and a half quarters of liquidity left. Current liabilities exceeded current assets by $11.6 million, while shareholders’ equity had fallen from $25.7 million in December to just $367,000.

Jumia was not out of cash, but it had little room for another bad quarter.

Jumia therefore agreed to sell 9.1 million new ADSs for $50 million. At $5.52 each, they were priced below the stock’s previous 52-week low. IFC supplied half the money; existing shareholder Axian and other investors supplied the rest.

The new shares dilute existing holders by approximately 7% and roughly double Jumia’s liquidity before fees and Q3 cash consumption.

Dufay said Jumia did not need the money to reach breakeven. It would use the additional room for inventory, selected categories and marketing.

Dufay has passed this test once. Jumia raised $94.7 million in August 2024 without returning to its old habits, and its operating cash outflow fell the following year. The $50 million gives him another chance to show that Jumia can remain disciplined on its path to adjusted EBITDA breakeven and positive cash flow. If both arrive in Q4, Jumia will have earned the asterisk in the headline. Profit will still have to wait.

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Zaccheus the tax collector wants 30% of your Crypto Profits

“Pay me in Bitcoin or get fined” - Tywin Lannister probably

A few headlines:

• 🦄We have a new unicorn - Mobility Fintech Startup has completed its latest $250 million funding round, valuing it at $2.1 billion. We wrote about Moove last year here and here

• 🕊️RIP to the Speculator - Victor Niederhoffer, pioneer of Quant statistical arbitrage, and Father of Aubrey Niederhoffer, the founder of Swoop, passed away this week at 82. Read about Victor and Swoop here

Hello there,

The Nigeria Revenue Service published its virtual asset tax guidelines on 31 July 2026, defining 6 categories and 16 taxable events.

The headline rates are 1.5% stamp duty on on-ramps and off-ramps. 1% withholding tax, 7.5% VAT, 10% on staking.

What does this all mean for my favourite fictional character Mama Nkechi and her crypto holdings?

Mama Nkechi imports phone accessories and has a supplier in Shenzhen. Every 6 weeks or so, an invoice arrives on WhatsApp/Wechat for her to pay. For the last 3 years, the invoice has hovered around $10K to $15K per order.

Because bank wires from Nigeria to China would typically take 3-5 days to settle, costing her an unexplainable percentage every time, she decided to start using crypto to settle this trade.

She sends Naira to a P2P desk, receives USDT, and forwards it to her supplier’s wallet address. She has been doing this since 2023, and end-to-end, it takes her about 40 minutes

In the next 6 weeks, Mama Nkechi will have to make payment for another invoice.

This is how the new tax policy changes everything for her:

Stamp duty

The Nigeria Tax Act charges duty on TOKEN to FIAT and FIAT to TOKEN transfers. The circular sets the rate at 1.5%. The duty is withheld in token units. It is borne by the transferee. And the fiat consideration is not reduced by it.

This means the next time Mama Nkechi wants to make a payment of $10K, she needs to trade for the Naira equivalent of $10,150 to account for the 1.5% stamp duty, before making payment to her supplier.

Should Mama Nkechi also receive payments from her customers in crypto, she needs to start factoring in the 1.5% in her price because whenever she off-ramps to Naira via her P2P supplier or exchange provider of choice, these duties must be collected.

Either traders and exchanges start marking up every transaction by 1.5% or every crossing between Naira and tokens inside Nigeria shaves another 1.5% off the token side infinitely.

Multiply Mama Nkechi by every small importer in Nigeria running the same route, and you have a levy on the country’s informal foreign exchange settlement layer.

She buys a little USDT every month to hold dollars

She moves ₦100,000 into USDT every month, 12 times a year.

Stamp Duty: 1.5% on each conversion, withheld in tokens. She pays ₦100,000 and receives ₦98,500 worth of USDT. That is ₦1,500 a month, ₦18,000 a year.

Withholding Tax: None. Stablecoins are Category 2, and the circular says no withholding applies on their disposal.

Her annual bill: ₦18,000 on ₦1.2 million saved. All of it duty, none of it tax on profit.

This is the largest group of Nigerian crypto users. People who are traders, protecting savings from the Naira devaluation, now have to pay 1.5% for the privilege each time.

She bought ₦1 million of Bitcoin, and it doubled

She buys ₦1 million of BTC. Stamp duty takes 0.015 BTC, so she holds 0.985 BTC.

Price doubles. She sells for ₦1.97 million.

Stamp duty at entry: ₦15,000.

Withholding at exit: 1% of gross proceeds, so about ₦19,700, taken in the token she sold.

Income tax: Her gain is ₦970,000. The first ₦800,000 of annual gains is exempt. The remaining ₦170,000 falls in the 15% band, so ₦25,500.

Total: about ₦60,200 on a ₦970,000 gain. Roughly 6.2%.

She bought ₦10 million of Bitcoin, and it doubled

Same trade, at a bigger scale.

Stamp duty at entry: ₦150,000.

Withholding at exit: 1% of ₦19.7 million, about ₦197,000.

Income tax: Gain of ₦9.7 million. Deduct the ₦800,000 exemption to leave ₦8.9 million. The next ₦2.2 million runs at 15%, giving ₦330,000. The remaining ₦6.7 million runs at 18%, giving ₦1,206,000. Total ₦1,536,000.

Her ₦197,000 withholding is credited against that, leaving ₦1,339,000 to pay at filing.

Total: About ₦1,686,000 on a ₦9.7 million gain. Roughly 17.4%.

Reason: The tax bands keep climbing: 21%, then 23%, then 25% above ₦50 million of gains. Individuals top out at 25%. Companies pay a flat 30%.

She is paid in USDT by a foreign client

Her invoice is $2,000 a month.

Income tax: Fees received in virtual assets are valued at their dollar fair market value on the date of receipt, converted to Naira at the CBN/NAFEM rate. Her client is offshore and will not withhold, so she has to self-assess on her annual return(LOL)

VAT: Where the payer is non-resident, the recipient accounts for VAT on the professional fees in Naira. Most Nigerian freelancers taking foreign work in stablecoins have never done this. Read that row of the table carefully.

Cashing out: You are selling USDT for Naira, which makes you the transferee of the fiat, not of the token. The stamp duty falls on whoever buys your USDT. No withholding on stablecoin disposals.

Her bill: Income tax at her tax band on roughly ₦33 million a year, plus VAT on her fees.

Her brother sends you money from London

He sends USDT. She sells it for Naira.

Withholding tax: None. Stablecoin. (If she receives Bitcoin though, withholding tax applies)

Stamp duty: Falls on the transferee of the token, meaning whoever buys the USDT from her, not her.

Her Bill: Nothing, statutorily

In practice, the exchange or the P2P counterparty will price their 1.5% into the rate she is quoted, so she will bear some of it.

She stakes crypto for yield

Let’s say she holds ₦5 million of ETH and stakes it at roughly 3%.

Rewards: ₦150,000 a year, taxable as income at the moment she receives it, valued at dollar fair market value on the date of receipt.

Withholding: 10% where distributed by a licensed provider, so ₦15,000, taken in the token she received.

Income tax: The ₦150,000 goes into her income for the year at your applicable band.

What of the Exchange Providers?

For Exchange providers, you now have responsibility according to the policy, such as:

You are now a collection agent: You withhold in token units, on two different legs, at two different rates. Stamp duty comes off the token credited to the buyer. Withholding comes off the token being sold. On a swap, it comes off whatever the user gave up.

You hold public money in a wallet: Withheld tokens go to NRS in the originating token, with no Naira conversion. Stamp duty must reach them by the 15th and the 30th of the month of transaction. Between withholding and remittance, you are holding a revenue authority’s tokens, which is a custody question before it is an engineering one.

You have to track cost base in dollars, per user, per lot: Token, quantity net of duty, dollar price at the timestamp, exchange rate at the timestamp, acquisition date. FIFO by default. Weighted average only if the user elects it at the start and never switches. This is the longest build in the whole circular and the least likely to exist in your schema today.

Every user must be onboarded with a Tax ID: VASPs and P2P escrow operators must make a valid Tax ID a precondition for account activation, under section 8 of the Tax Administration Act. No Tax ID, no account. Tax registration now has to be wired into exchange onboarding.

Your users will trade less: A round trip through your platform now carries roughly 2.5% in frictional tax before anyone counts a gain.

Fines: ₦10 million for the first month of non-compliance, ₦1 million every month after. 40% of anything you fail to deduct. If you deducted and did not remit, the amount plus 10% per annum plus policy rate interest.

This time it’s different

This is the second attempt. The Finance Act 2023 put 10% on gains from digital assets, and enforcement went nowhere.

The difference this time is that nobody is asking you to volunteer. The exchange withholds before you see the money, and the exchange cannot open your account without a Tax ID.

Credit where it’s due, the circular is an end-to-end researched project that tries to block and account for every potential loophole, enabling the Nigerian Revenue Service to achieve its goals.

They also refuse to tax devaluation by using the dollar-referenced gain clause, which says

When you dispose of a crypto asset, your gain is computed in dollars first. Dollar cost base at acquisition, dollar proceeds at disposal, dollar gain. Only that dollar figure gets converted to Naira at the CBN/NAFEM rate on the day you sold.

Let’s say Mama Nkechi buys at ₦1 million when the rate is ₦1,000 to the Dollar, and sells at ₦1.97 million when it is ₦1,500.

Naira arithmetic says she gained ₦970,000. NRS assesses ₦470,000. The other ₦500,000 is the currency falling, and they let it go.

Compared to how banks faced the windfall tax on FX gain income, the tax authority here has admitted that most Naira-denominated gains are artificially manufactured, and has declined to tax those gains (for now).

What Next for Zaccheus?

The NRS still needs to share communication on its plans for a token treasury, and a list of tokens they will accept.

Meanwhile, the SEC also doubled the VASP capital requirement to ₦2 billion in January, and only a handful of firms hold Approval-in-Principle. The correct collection and implementation of these policies will apply to only a handful of companies, which leads me to ask what this means for neobanks who have stablecoin capabilities, and crypto infrastructure providers?

The Nigeria Revenue Service is about to become a holder of digital assets. It will need custody. It will need a disposal policy. It will be exposed to the price of whatever tokens Nigerians happen to be trading, which means it now has a balance sheet position in Bitcoin volatility whether it wants it or not.

No other tax authority has done this. Most jurisdictions require conversion to fiat before remittance precisely to avoid inheriting the price risk. They think conversion friction is a bigger problem.

The only argument I can find for this is that requiring a VASP to convert every withheld token to Naira before remitting would push enormous volume through the FX market for no revenue purpose.

If that is the case, there’s only one way to end this.

“Zaccheus, what is your wallet address?”

** The Opinions shared here are the independent analysis of the author and do not represent the views of any organisation they may be affiliated with. Nothing in this opinion piece should be regarded as Tax, Legal, Financial, or Regulatory advice.

Please do your own research and engage licensed practitioners wherever necessary.

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Fourfold

It was written in the stars that when Nigeria finally got around to taxing crypto, it wouldn’t be able to resist a touch of greed.

Nigeria has never particularly liked crypto. In 2021, the Central Bank ordered banks to stop facilitating crypto transactions and close accounts linked to them.

The restrictions were partly relaxed in December 2023, and while Banks could now open accounts for licensed crypto businesses, they still could not hold or trade crypto.

Two months later, as the naira sank to new lows after a free float, the government detained two Binance executives who had travelled to Nigeria for meetings, and brought tax-evasion and money-laundering cases against the company. Binance, the claim said, had contributed to currency problems by providing a market where the naira could be traded while dollars were scarce.

But the relationship has since warmed. On July 31, Nigeria’s love story with crypto extended to guidelines for taxing virtual assets.

The new guidelines are so grabby, it would make Zaccheus, the biblical taxman (and the namesake of Nigeria’s current tax chief), blush.

Per the guidelines, if you sell Bitcoin for naira on a Nigerian exchange, that transaction can produce four tax claims.

The guidelines go further. In one example, someone buys two Ether for $3,000 and later swaps them for 0.1 Bitcoin when the Ether are worth $4,000.

The NRS treats the Ether as sold for $4,000, producing a $1,000 gain, even though the person owned crypto before the trade and crypto afterwards. That gain is converted to naira at the official exchange rate and taxed. The Bitcoin is treated as having cost $4,000, which becomes the starting point for calculating the next gain.

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The exchange must also withhold 1% of the two Ether being disposed of, or 0.02 ETH, and send it to an NRS-controlled wallet. At the prices in the example, the government receives $40 worth immediately and will still collect VAT from the exchange’s fee. The only mercy is that the 1.5% stamp duty does not apply because no fiat currency (naira) is in the trade.

With the withholding tax, two Ether for 0.1 Bitcoin is really 2.02 Ether for 0.1 Bitcoin: two Ether for the swap and 0.02 ETH for the NRS. The guidelines do not say whether that 0.02 ETH comes on top of the trade or out of the two Ether being exchanged.

The NRS has effectively made crypto exchanges tax collectors, requiring them to deduct taxes from users’ trades and send the money to the government.

It’s unclear whether that’s the intention, but the guidelines incentivise users to avoid exchanges altogether. A peer-to-peer trade can happen outside the NRS’s view, and anyone deliberately sidestepping an exchange is unlikely to declare that trade in their tax filing.

Nigeria’s 2021 banking restrictions already pushed crypto trading towards P2P markets. The new rules may push even more activity there.

Everyone and their daddy now uses stablecoins for cross-border payments. An importer converts naira into USDT and pays a supplier in China. Businesses do not necessarily care about crypto, but they care that stablecoins provide something resembling dollar access and speed.

Under the guidelines, a Nigerian business that converts naira into stablecoins to make a cross-border payment will pay 1.5% stamp duty on the conversion. The intermediary must deduct the 1.5% stamp duty from the stablecoins before sending the balance overseas.

A company expecting to make $5,000 of gross profit from a $100,000 shipment would surrender roughly $1,523 while paying the supplier. That is more than 30% of its expected gross profit before shipping, customs, storage, salaries, and the small matter of selling the goods. It can absorb the cost, persuade the supplier to accept less, or pass it to Nigerian customers.

A company moving $100,000 every month would pay roughly $18,274 a year in stamp duty alone, before exchange spreads, platform fees, and VAT on those fees.

The biblical Zacchaeus promised to repay fourfold anyone he had cheated after meeting Jesus. These guidelines have yet to find theirs.

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Everyone is in the Arena

Stephen A. Smith is the highest-paid basketball analyst in the world. Depending on whose figures you believe, ESPN will pay him around $100 million over five years to talk about sports.

He never played in the NBA. In his final season at college, he averaged 1.5 points per game, a statistic the internet has used as a running joke for over two decades. In a colorful career on television, he has feuded with LeBron James, Bronny James, Kyrie Irving, Jaylen Brown, Zion Williamson and Kevin Durant.

In a business full of Hall of Famers, championship-winning coaches and former executives on television, the most influential voice in basketball is a man who never played it professionally.

Despite this, Smith likes to remind players that the media attention they resent makes their enormous contracts possible. Charles Barkley, who earned about $40 million during his 16-year career, has pointed out that teams now hand $300 million to “bums.”

While it all sounds like two rich broadcasters being rude to younger rich people, it is also broadly how basketball makes money.

Fans watch games, and networks pay the NBA for the right to air them. The league shares the television money with teams who channel it towards salaries.

The 48-minute game is the main event, but the feuds, interviews, podcasts, and television content keep people interested between games. ESPN pays Stephen A. because he can attract an audience, and downstream of that is revenue for $300 million contracts.

This brings us, unfortunately, to another media-versus-man-in-the-arena argument.

Conversations are part of the product.

Building a market requires people to care. If a startup builds a product, they need people to write about it, argue, or constructively tear it apart.

Last week, GoLemon announced that it was shutting down, and the Nigerian technology ecosystem reacted accordingly. Customers shared stories about a product they loved while others explained why they had stopped using it. Operators broke down the economics of grocery delivery while journalists revisited GoLemon’s journey and the wider venture-backed logistics market. Newsletter writers published post-mortems and consultants offered strategies nobody requested. Instagram reels gave us reflections and hot takes.

These reflections ranged from thoughtful to lazy to blaming the economy and government to being flat-out wrong.

Predictably, founders, friends of founders, investors, and those who dub themselves the ‘men in the arena’ (from the famous Teddy Roosevelt speech) logged on. They objected that people who have never built companies have no right to analyse those who have, a.k.a, talk is cheap.

Building a company is hard work, and watching years of work reduced to a lazy LinkedIn post must suck, but this default response to criticism and commentary is equally as lazy.

We complain about Apple, GTBank, OpenAI, X, and Google all the time. Human beings work there, and some have devoted twenty years of their lives to these companies. The difference is that most people cannot send Tim Cook a WhatsApp message or run into Sam Altman at a technology conference.

Yet, because we know startup founders in Nigeria, can reach them and may need a favour from them one day, their companies are supposed to sit outside the normal range of public commentary. Familiarity must become immunity.

Paying customers are allowed to have opinions about the companies taking their money. Employees are allowed to discuss the places where they spend most of their waking hours, and investors are allowed to ask what happened to their capital. Journalists should examine companies that want customers, funding, regulatory concessions and flattering profiles when things are going well.

A founder obviously has more at stake than someone firing off a LinkedIn post from the safety of their office. The founder’s explanation carries more weight, but it does not mean everyone else is sitting in the stands eating popcorn.

One of the biggest stories from the World Cup was Cabo Verde’s 40-year-old goalkeeper Vozinha, who made seven saves in a 0–0 draw with Spain.

During the game, the Brazilian broadcaster CazéTV began asking viewers to follow Vozinha on Instagram. He went from roughly 50,000 followers before the match to nearly 10 million within 24 hours and almost 30 million by the end of the tournament.

Five days later, Curaçao’s Eloy Room made 15 saves against Ecuador, setting the World Cup record for most saves completed in 90 minutes. Room produced the better single performance of the tournament, yet his Instagram following grew to a modest 800K on the same day as the match.

The difference in outcomes here is thanks to media narratives and commentary around both individual performances.

That is not a flaw in the media. It is how the media works everywhere, in sports, entertainment, business, politics. MI Abaga said it best.

“If nobody talks about you, then you are nobody.”

Being talked about is one of the costs of building something that hopes to attract paying customers. The attention that brings users, investors, and glowing profiles will occasionally bring criticism, mockery, and people who confidently misunderstand the business.

The right to comment is not a licence to be careless.

A useful post-mortem should explain what happened, show evidence and distinguish what is known from what the writer is guessing. Founders should correct false claims, and commentators should accept those corrections. Personal attacks and cruelty add nothing.

Every space needs its NBA Twitter, Football Twitter, Stephen A. Smiths, and Fabrizio Romanos to complement its Ernie Johnsons and David Ornsteins, and they have to coexist with the product that attracts viewership, paying customers, and analysts.

Super fans, haters, professional talking heads, podcasters, newsletter writers, consultants, armchair quarterbacks, quality and poor commentary can exist side by side, with the entrepreneurs in the arena, but silence, cruelty, laziness, personal attacks, and policing of speech on both sides does not advance the space when issues are had.

My bias is to employees, and whenever people invoke the arena, they rarely mean the people who spent years building the company beside them.

When GoLemon announced its shutdown, one of the applaudable things the founders did was publicly recommend their team for new roles.

Those employees were also in the arena, as were the customers.

Nothing but respect to people in the arena.

All of them.