Subscribe now

TOGETHER WITH CREDIT DIRECT

Get the Cash Flow Framework for Business Owners, co-written with Olagoke Balogun, the CEO of So Fresh.

Get The Guide

How to fight disruption

Our people say that when a man wakes up is his own morning, so good morning to me.

Sometime this week, my lawyer friend mentioned that he was representing someone at an Advertising Tribunal and was trying to perfect bail of ₦2 million for her. His client’s offence was advertising on Instagram without getting approval from the Advertising Regulatory Council of Nigeria (ARCON).

I’d seen a few advertising professionals rage against ARCON’s overreach in the past, but it always existed in the back of my consciousness; this week, I could not get over the absurdity of anyone needing to arrange bail of N2 million for posting ads on Instagram. The last time I checked, some of those ads cost something like $5 a day.

As it happens, my friend’s client is not an edge case. In early 2024, the Advertisers Association of Nigeria told PUNCH that roughly fifty of its member companies had been dragged before the Advertising Tribunal, with bench warrants issued for managing directors of firms that refused to appear.

Captain Ado Sanusi, the MD of Aero Contractors, was hit with a twenty-two-count criminal charge for tweets that said things like “Fly with us to Sokoto” and “The journey of a lifetime.”

If you take even five minutes to research this, you’ll find that this is one of the most ridiculous examples of a regulator refusing to get disrupted as the shape and form of advertising changed under its feet. You’ll also find an agency that got itself legislated from the brink of disruption.

To advertise lawfully on social media in Nigeria today, you must file a paper application addressed to the Director-General of ARCON, signed by a registered advertising practitioner. Your application must include the ad itself, a completed Standards Panel Form 001, and a payment receipt of N20,000 per concept.

Approval timelines are not built for real-time digital advertising, with ARCON’s guidelines showing that its approval Panel meets monthly, with accelerated vetting available.

You can pay N70,000 for a sixteen-hour turnaround for ten concepts, while N100,000 gets you an eight-hour turnaround for fifteen concepts.

If you used a foreign model or shot the ad abroad, there is a deterrent fee of N3 million. If you skip any of this and run the ad anyway, the regularisation fee is N1 million per infraction, demanded within seven days, rising to N3 million if you run three posts without approval.

Let’s back up a bit. For most of Nigeria’s history, if you wanted to put an ad in front of a Nigerian, you needed airtime, which was controlled by a handful of broadcasters, newspapers, and outdoor firms. You also needed a creative asset, which meant a production company doing a video or print for a billboard. Then you needed placement, a.k.a somebody who knew which slot on which station at what hour reached which audience at what rate. All of this complexity was handled by an advertising agency/media buyer.

The Advertising Practitioners Council of Nigeria (APCON), which was ARCON’s predecessor, sat on top of this structure and regulated the practitioners who worked within it. Everyone in the value chain, like copywriters, media buyers, and account managers, had to be registered.

But once we could pay for things online reliably, online advertising was within reach of anyone with a debit card and internet access. It was the beginning of the end of the monopoly broadcasters had on exposure.

Facebook, Instagram, WhatsApp, and the rest of the Meta stack also broke the placement monopoly, because you no longer needed a media buyer to decide who to show your ad to. Their algorithms did the targeting better than any human planner could ever dream of.

YouTube made a phone sufficient for video, and TikTok went further with ads that did not look like ads, made by creators, outperforming anything some production houses could create. Influencer marketing severed the final cord, and by the early 2020s, an ad could be a human being posting on their own feed about a product they had been paid to use, with no agency, production company, or registered practitioner in the value chain.

Each wave of disruption took away a function that the advertising regulator used to perform, and by 2022, a hairdresser in Surulere could reach hundreds of thousands of Nigerians without even knowing who a registered practitioner was.

The only cost was whatever Instagram/Facebook or Google charged, and then later in 2022, 7.5% VAT. A growing share of advertising could now happen outside the professional chain that APCON was built to regulate.

When you’re getting disrupted like this, you cannot put your head in the sand; your bottom line will let you know that there’s fire on the mountain, and you will fight like hell against it. In 2014, APCON began issuing violation notices and fines to the people who advertised without paying the stipulated fees.

The funeral home MIC Royal Limited was fined N500,000 for placing an ad in the PUNCH newspaper without going through an APCON-registered practitioner. The Registered Trustees of the International Covenant Ministerial Council got a similar fine, but both entities refused to pay and instead went to court.

As the courts interpreted it, the old APCON law was built around advertising practitioners, not advertising itself; ergo, if you were not a registered practitioner, APCON had no authority over you; my hairdresser in Surulere could go on with her ads.

At this point, the regulator had a choice. It could accept that the economy had moved somewhere its statute was not designed to follow, and build a new model, or even pivot to post-publication review like the UK’s Advertising Standards Authority.

But this is Nigeria, so the National Assembly enacted a new Act that guaranteed the survival of the advertising regulator.

In 2022, the APCON Act was repealed, and in its place came the ARCON Act, which included a provision (Section 54) that any person who places an ad targeting the Nigerian market without the prior approval of the Advertising Standards Panel commits a criminal offence.

So we went from an act that regulated advertising professionals to an act that targeted everyone who advertised to Nigerians; my Surulere hairdresser in Surulere was suddenly in danger.

Armed with Section 54, ARCON was emboldened. In a January 2024 PUNCH interview, Advertisers Association of Nigeria (ADVAN) president Osamede Uwubanmwen connected ARCON’s aggression to the Federal Government removing the regulator from national budgetary allocation. ARCON was tilting towards “an aggressive taxing regime” that was stifling the industry and “If we are not careful, we will be told to vet obituaries,” Uwubanmwen added.

Some people will argue there is a case for ARCON vetting ads, seeing as Nigerians got defrauded by Ponzi schemes, which did a fair bit of advertising. Meta’s moderation does almost nothing at the Nigerian end.

Yet, the argument for regulation ignores the fact that regulations exist. The Cybercrimes Act of 2024 makes it a crime to publish misleading content online, and the Federal Competition and Consumer Protection Commission already polices deceptive commercial practices.

If you pay the fine, you have still not been approved, so you have to vet the ad afterward anyway. If you cannot pay the fine and refuse to appear before the Advertising Offences Tribunal, there will be a bench warrant out for you.

This is how my friend’s client, an honest-to-God business owner, ended up on bail of N2 million with two sureties in like sum.

The Tribunal charging her is a body whose members are appointed on ARCON’s recommendation to the Minister of Information.

Did I mention that Section 45 of the Act lets the Tribunal Chairman issue a warrant for the police to enter business premises by force?

My friend’s client will make her bail. She will probably fight the charge, or pay the fine, or both, because that is what people who run small businesses in Nigeria do when the state puts its hand on them.

Share

Welcome to Nigeria.

See you on Sunday!

If you missed Friday’s newsletter, catch up here. If this email was forwarded to you, subscribe here for free:

Subscribe now

TOGETHER WITH CREDIT DIRECT

The least favourite shopping experience is not being able to afford the things you want. Credit Direct Checkout ensures this never happens. All you need is a 25% down payment.

Know Your Limit

A few thoughts on methods

In 2021, I wrote a newsletter arguing that Nigerian journalism needed a reckoning over methods. The impetus for that argument was “Cornflakes for Jihad,” a viral article by a journalist at the height of his fame. Several smart editors told me not to publish. I did anyway, because it’s always worth putting methodological disagreements on the record. I have been thinking about those methods again with another publication that’s now at the height of its powers.

GST, the youth-focused political media platform, has built something many Nigerian political media have struggled with: a real sense of urgency among young people. Communiqué’s recent profile describes it as a media platform and a vehicle for real-time civic participation. It is social-first and organised around a logic of story, campaign, pressure, and response. Its founder, Adewunmi Emoruwa, has said openly that GST rejected the principle of strict neutrality from the start. “We are going to editorialise from the beginning,” he told Communiqué. “We’re going to give people the truth.”

That should interest anyone who cares about the media, because Nigerian journalism has spent years trying to get young people interested in politics. The industry has tried explainers, breaking news, video, simplification, Instagram packaging — all the usual tricks for making politics feel accessible. A few of those digital publications have become real cultural touchpoints.

GST has found that what really moves people is not format but stance. It is succeeding because it offers some young audiences explanation and alignment; it’s a publication that shares their anger and tells them what to do with it.

Nigerian media has a credibility problem with young audiences, with legacy outlets widely perceived as deferential to power and reluctant to hold the line when it matters. In that environment, a publication that is openly adversarial toward government is filling a vacuum that traditional journalism created by failing to be adversarial enough.

People do not want GST to be neutral because they do not believe neutrality, as practised by Nigerian newsrooms, has produced accountability. They want someone who will say the thing and stay on it until something moves. You can compare this to Fox News in the US, although the analogy is imperfect because Nigeria does not have a left-right ideological axis in the American sense, so GST is not anchoring one end of a partisan divide. It is closer to a mood: the widespread sense among younger Nigerians that the political class is extractive and unaccountable, and that the media has been more interested in access than in pressure.

There is also a structural argument in GST’s favour. Traditional accountability journalism in Nigeria has historically stopped at revelation. An investigation gets published, it trends for a day, and for the public, nothing happens, and everyone moves on.

The distance between “informed” and “activated” is itself a democratic failure, and GST’s model — story, campaign, pressure, response — is an attempt to close that gap. If the point of journalism is to serve the public interest, and if the public interest requires not just information but consequence, then you can argue that GST is doing what the rest of the industry has been too polite to do.

Yet, it’s worth asking, what does this kind of stance do to the reporting?

Once a publication is organised to generate pressure, it is incentivised not just to find out what is true but to identify the version of the truth most useful for mobilisation. Facts that sharpen the case move to the front, and nuance gets shunted to the side. What discipline can one hope for once a newsroom begins with its conclusion?

Consider GST’s coverage of the tax reform bills. The underlying grievance against the tax reforms was real and widely shared. Nigeria’s public services are poor, and the trust deficit between citizens and the state is enormous; it has created the feeling that taxation without adequate public infrastructure is extractive. There is a legitimate debate to be had about whether this government has earned the right to ask for more.

Yet, in GTS’s video on the tax bill, the platform told its audience: “There are no tax reforms here that benefit you. None.” It described the reforms as “theft.” It asked whether taxes have ever helped Nigerians and answered its own question: “Not in a million years.”

What the video didn’t do at any point was engage with what the reforms actually contained. The bills raised the income tax exemption threshold to ₦800,000 for low-income earners. The bill reduced Company Income Tax from 30% to 25%. They exempted small businesses with a turnover under ₦50 million. You can argue these provisions are insufficient, or that the government cannot be trusted to implement them honestly. Those are fair arguments and worth making, but their tax videos did not make them. It simply declared the entire enterprise a fraud and moved on.

When you have a viewpoint, supporting facts are amplified. Facts that complicate it are pushed aside.

Every reporter who has done serious work knows this process: you begin with a hunch, then you make calls, read documents, speak to more people. At some point, the story shifts. Sometimes it softens, and other times it turns against your original instinct. Sometimes you find that your first take was too neat. That is the journalistic method.

Facts do not always arrange themselves into clean narratives unless someone leaves some of them out. A government policy might be badly designed, but also solve a real problem. An official might be corrupt and also be right about the thing they are being attacked for. The discipline of reporting is the willingness to hold both possibilities open until the evidence closes one of them.

Serious policy stories require the journalist to go and find the people who actually understand the subject and let those people complicate the picture. The expert who says “it’s not that simple” is not being unhelpful; they are giving you the story.

Ultimately, the thing to think about is that once an audience understands that a publication has a position on editorial identity, they begin to discount it.

The reporting might be accurate, and the facts might be right, but the reader knows that the facts were selected to build a case, and so they feel a pull to go and hear the other side before forming a view.

Fox covers real stories and breaks real news, but you don’t watch Fox believing that you’re getting the complete picture. You watch Fox to get the Fox version, and then you might even check CNN to get another frame.

This kind of journalism eventually loses its authority to settle questions. A platform built to mobilise might consider this an acceptable trade-off — you do not need to be the definitive account if you can be the most energising one. But the publication trains its own audience to treat it as a source of perspective rather than a source of fact, and once that expectation sets in, it is very difficult to reverse.

If this email was forwarded to you, subscribe here:

Subscribe now

TOGETHER WITH CREDIT DIRECT

If you wake up to a cryptic text from your ex and your bank account is drained, what would you do?

Read The Story Here

Airtime Lending is Easy

MTN Nigeria suspended Xtratime early this week; today, Airtel followed. Tens of millions of Nigerians who borrow airtime and data daily — through a system where repayment simply comes out of your next recharge — woke up to find the lending machine switched off.

My first instinct was fraud. When an easy “Lending Is Easy” business suddenly stops working, the first guess is usually that some bad actor has managed to jam it. One Value Added Service (VAS) operator told Notadeepdive it can advance up to ₦400 million a day, and in H1 2025, MTN Nigeria’s fintech revenue had reached ₦83.2 billion, with the company saying the growth was majorly driven by airtime lending and advanced services.

The truth, it turns out, is that the suspensions are not about fraud. They are about what happens when a regulator sets out to fix one problem and ends up redesigning it.

The Rules

Nigeria's digital lenders have needed regulation for a while. The loan apps that multiplied over the past few years brought with them harassment, contact scraping, and public shaming as a collections strategy. The Federal Competition and Consumer Protection Commission responded in 2025 with a broad set of rules for Digital, Electronic, Online, or Non-Traditional (DEON) Consumer Lending. The case for that intervention was strong.

The VAS end of the market had its own problems. Forceful subscriptions, auto-renewals, opaque billing; the space has a long history of sharp practices that made consumer protection a real regulatory issue. Nobody can argue that the sector deserved to be left alone.

But what the FCCPC actually produced went further than consumer protection. The DEON regulations pulled airtime and data lending into scope and then imposed a set of requirements that have nothing obvious to do with protecting borrowers. Lenders providing airtime or data credit must work with at least two intermediaries. At least one of those intermediaries must be fully Nigerian-owned. Exclusive arrangements are restricted. Agreements between lenders and service providers and even modifications to those agreements must be filed with the FCCPC for approval.

If your problem is borrowers being harassed, shamed, and overcharged, those are unusual places to linger. Harassment, opacity, data abuse, and predatory collections are one category of problem. Ownership structure, intermediary count, exclusivity, and commercial agreement approvals are a different category entirely.

Since the rules were introduced in July 2025, most of the VAS players began pushing back discreetly, two people with direct knowledge of the matter told me. The compliance deadline was set for January 2026, and for a while, the industry seemed to have treated this as the sort of Nigerian rule that makes noise and then gets worked around.

It did not get worked around. By April, the FCCPC had demanded written assurances of compliance, set an April 16 deadline, and threatened sanctions against operators who did not fall in line. That is the escalation that forced everything into the open.

On April 14, two days before the deadline, the Wireless Application Service Providers Association of Nigeria filed suit at the Federal High Court in Lagos, arguing that the FCCPC had crossed from consumer protection into telecom regulation — territory that belongs to the Nigerian Communications Commission under the Nigerian Communications Act. Justice Lewis-Allagoa has not ruled on the substance but granted an interim order restraining the FCCPC from enforcing key provisions pending a hearing on April 27.

MTN and Airtel appear to have suspended their airtime lending services, not because the court told them to, but because the regulatory ground underneath them had become too unstable to keep operating on. When your regulator is demanding compliance with rules that a court has just frozen, the safest move is to stop moving.

The result is that a set of rules introduced to protect consumers has, for now, removed a service that tens of millions of consumers actually use. The FCCPC wanted to clean up digital lending. What it got, at least this week, is a market that has stopped lending entirely.

There are many ways to regulate bad lenders. You can stop them from harassing borrowers. You can make pricing transparent. You can punish abusive recovery tactics. You can require licensing and reporting.

What is less intuitive is telling airtime lenders how many intermediaries they must use, what nationality those intermediaries must be, and then requiring regulatory approval for every commercial arrangement in the chain. That is less consumer protection and more market design.

In a business built on captive customers and massive daily volumes, the commercial question is not really who lends but who gets to stand in the middle. The FCCPC’s rules regulate lending and restructure who is permitted to intermediate it, and on what terms.

A cynical person might look at all this and think that Nigeria has never met a healthy pool of cash without immediately wondering how to insert a middleman into it. Scale can wait. Global ambition can wait. Building the best company can wait. First, let us decide who gets to stand in the middle and collect.

The official case for the rule is consumer protection. The public explanation for why consumer protection requires a wholly local intermediary is unclear.

I am not a cynical person. So I am perfectly willing to believe that the FCCPC’s interest in deciding who gets to stand inside one of telecoms’ juiciest business lines is just a coincidence.

Share

See you on Sunday.

If you missed Friday’s newsletter, catch up here. If this newsletter was forwarded to you, subscribe for free:

Subscribe now

TOGETHER WITH CREDIT DIRECT

The question business owners need to start asking is “How do I keep more of the money my business is making?”

Credit Direct has partnered with Mr Olagoke Balogun to answer this question.

Join us on the 18th of April for a virtual session on Money Talks: The Cash Flow Blueprint for Building 100M+ Businesses.

Register Now

Customer accepted higher tariffs, telcos now need to suck it up

Typically, when your network is bad in Nigeria, you can swear at your telecom provider, type an angry complaint on social media using the same bad network, and well…move on with your life. Starting this month, the Nigerian Communications Commission says the networks should feel some of that pain too. Under a new framework, subscribers in areas affected by poor service will receive automatic airtime credits. The operator will identify the affected local government area, match it against subscribers who actually generated billed usage there, and issue credits to affected users.

A heavy data user with a miserable connection should therefore get more than a light caller, because the credit is tied to usage and spending patterns. The cost to the operator rises with the revenue it is earning from the people and places it is underserving.

Earlier this year, TechCabal reported that the regulator was moving to impose about ₦12.4 billion in penalties across the industry for breaches of service standards. That sounds severe until you compare it to the scale of the business. MTN Nigeria alone reported ₦5.2 trillion in service revenue and ₦1.1 trillion in profit after tax.

Nigeria has tried compensation before. In 2008, Ernest Ndukwe’s NCC ordered MTN and Celtel to compensate subscribers for persistent poor quality. The operators resisted the whole thing, went to court and lost. MTN later moved to refund about ₦2.7 billion in airtime, and Celtel rolled out a phased compensation plan.

Today, the operators’ best defence is that the new compensation framework attacks the symptom, not the cause. They will point to fibre cuts, diesel costs, vandalism, and the ugly economics of rolling out infrastructure outside the richest corridors. Some of that is true.

But customers also accepted higher tariff prices, and the largest operator is back to profitability. The harder it becomes to argue poverty, the easier it becomes for the regulator to argue that bad service should cost money.

More Lending Is Easy

In June 2023, the Tinubu administration and the CBN got sick of kicking the can down the road and decided to let currency prices be decided by the market. If policymakers took forever to get to a common-sense decision, Nigeria’s big banks had been around long enough to position themselves to profit from a currency repricing.

By December 2024, Zenith held ₦281 billion in derivative assets — the unrealised gains on those positions — against ₦9 billion in derivative liabilities. 2024 rewarded banks for surviving a huge currency repricing.

A year later, those gains went the other way and derivative assets were ₦8 billion vs derivative liabilities of ₦196 billion. Everyone had to go back to the less glamorous business of being Nigerian banks, which, as I pointed out two weeks ago, is less about lending and more about smart capital allocation.

Consumer lending was ₦180.6 billion, down from ₦336.5 billion the year before. It is even smaller than GTCO’s retail lending bucket, which was ₦249.2 billion in 2025. If there’s a retail lending party, Zenith Bank is happy to stay at home. Instead, it piled money into treasury bills, pretty much risk-free and called it a day.

Bonus: Zenith wrote off ₦1.24 trillion of loans in 2025 and framed it as a “bold and prudent clean up.” The reality was more like it was a forced clean-up after the CBN stopped letting banks avoid full provisioning on some stressed foreign-currency loans. It was decided that banks under the forbearance regime could not pay dividends, bonuses to directors and senior management, or invest in foreign subsidiaries until their capital and provisioning positions were fixed.

That said, Zenith remains a deposit-mobilising monster with total deposits reaching ₦24.33 trillion. It has 30 million cardholders and 456 branches.

Share

See you next week!

We’re super close to cracking 5k subscribers. Help us get there by sharing this newsletter with friends, enemies and in your group chat.

Share

And if you’re the lucky person this email was forwarded to, subscribe here for you:

Subscribe now

TOGETHER WITH CREDIT DIRECT

The question business owners need to start asking is “How do I keep more of the money my business is making?”

Credit Direct has partnered with Mr Olagoke Balogun to answer this question.

Join us on the 18th of April for a virtual session on Money Talks: The Cash Flow Blueprint for Building 100M+ Businesses.

Register Now

We Need to Talk About Marketing

Marketing professionals, like practitioners of every art form, find themselves in a dilemma. Their artistic expression exists to craft a narrative for an audience and sell a brand. But they also have to wield that same expertise to impress their fellow marketing colleagues, and potential future employers and clients.

There’s the problem.

What marketers, customers, regulators, competition, and industry colleagues call good marketing copy could be completely different things. And with every art form, what passes as good is “subjective” and contextual.

Left: An Insurance Company trying to be trendy, Right: A furniture company

I am writing this while having a KitKat, and I am sure it’s largely prompted by KitKat’s announcement that 12 tons of KitKat had been stolen. That’s marketing. It made me buy chocolate I wasn’t thinking about.

Over the last few weeks, I have observed what I can only term good marketing, unsportsmanlike marketing, and straight-up lies dressed as copy. And every time I forward these to my marketing friends, they only celebrate the smart copy — without context.

When a company buys up ad space at the location of a competitor’s event in a bid to convert eyeballs they did not acquire, it is reminiscent of famed campaigns such as Tesco vs ASDA vs Sainsbury’s, Mac vs PC, Samsung vs iPhone, Mercedes vs BMW, FedEx vs UPS, and Nike’s famous stealing of the World Cup and Olympics campaigns.

These are crafty; they show maturity, and any form of counter-response is valid. Marketing folks should be applauded for their inventiveness here.

But it seems to me that participants of the growing Nigerian ecosystem do not understand that industries are different and operate with different rules.

Industries like B2B SaaS, e-commerce, crypto, consumer hardware, and apparel companies have historically had marketers stretch the truth and be celebrated for it.

There is a reason Bill Gates, Elon Musk, Sam Altman, and Steve Jobs were celebrated for selling products that didn’t exist yet (even if they did eventually deliver), but Elizabeth Holmes at Theranos, SBF at FTX, and CZ at Binance went to prison for what looked like lesser offences on the face of it.

The difference isn’t the size of the lie, but the industry. Norms, rules, and regulations differ. Tech audiences will tolerate aspirational selling. Financial services audiences, customers, regulators, and the courts do not.

When money is involved, the person being lied to is a disappointed early adopter who trusted you with their savings and livelihood. Therefore, the potential for harm is fundamentally different.

Financial services, just like healthcare, have second-order effects beyond us, the players.

In November 2025, the Central Bank issued a circular directing all financial institutions to immediately withdraw non-compliant advertisements. All ads must now be factual, balanced, and transparent.

Exaggerating product benefits — banned. Omitting material information — banned. Comparative or superlative claims — banned. Starting January 2026, the CBN said it would review and impose sanctions for breaches.

So companies should not be notorious for sleights of hand with their marketing, no matter how glossy or impressive it would look to fellow marketing colleagues.

They are doing impressive things already. There is room to sell the truth about what is being built without exaggerating. Especially as we are entering the second decade of life for some of the leading companies in Nigeria’s financial services ecosystem.

So yes, it has to be repeated. Being ambiguous about a microfinance bank licence by pulling a “banking licence” pump fake is not marketing. It’s a lie.

The local and international media that ran with this narrative, rather than challenge claims of “full-scale financial services,” to compete with Access Bank and Zenith Bank, should have done better.

It’s a microfinance bank licence. It’s a good move — they can now hold deposits, retain more in the settlement value chain, and build lending products off open banking data.

They processed $40 billion in a decade. They joined the CBN’s Virtual Assets AML pilot.- These were strong stories on their own. You don’t need to embellish any of that. Tell that story.

But calling a microfinance bank licence “a banking license” - intentionally omitting that qualifier, while operating in a regulated space that should inspire trust. How should I then trust you with my deposits?

I get that founders have to be delusionally optimistic. I get the Jedi mind tricks on your org and the public to inspire belief. But there has to be a line between founder optimism and customer deception.

And it’s not just the licence framing. Marketing statements across other large players in the industry, like “we are the biggest agent network in Nigeria.” Or “the most licensed institution in Africa.” Or “we process 87% of NIBSS volumes.” These are lies.

And the risk is that regulators, journalists, informed consumers, or even your competition could call you out, causing harm to your brand and the space you operate in.

The Nigerian fintech ecosystem has done remarkable things over the last decade. We don’t need to lie about what we are doing. Rather, we need to get better at telling the truth about it in a compelling, confident manner.

Because if the question becomes “should I trust you with my deposits?” — your marketing copy better be the same as your regulatory filings.

I get it, everyone is trying to pander to investors these days. But does it have to come at the expense of writing marketing checks your organisation cannot cash, nor the regulatory and reputational risk that comes with it?

We don’t need sleight of hand. The truth is already impressive. Tell that one.

Every time you like the newsletter, it increases the chance that more people will find it! See you Sunday.

Leave a comment

Subscribe now

TOGETHER WITH CREDIT DIRECT

Credit Direct wishes you a reflective and meaningful Good Friday!

Make Microfinance Banks Great Again

Nigeria has over 800 insured microfinance banks, which, if it needs pointing out, is a lot of MFBs.

So “Company X gets a microfinance bank licence” is usually the sort of story that matters a lot to Company X and not very much to the rest of us. Fintechs acquire these licences, founders own them, and sometimes people even hawk said licences on LinkedIn (I’m not making this up!).

A microfinance bank licence is only a story people care about if the company is big enough to make it one.

Flutterwave announced this week that it had secured a Nigerian microfinance banking licence that lets it hold funds and deposits directly and improve settlement efficiency in Nigeria. TechCabal added that the licence came through Flutterwave’s January acquisition of Mono.

So there are two angles to the story. One is that Flutterwave has unlocked an important new capability. The other is that Flutterwave bought a company with a useful licence, upgraded the licence, and announced the result as a crucial milestone.

Why is a microfinance bank licence so special? A lot of the reports on the licence already share this, so let’s not dwell on those.

“In ten years, I see that Flutterwave will be either the JP Morgan of Africa or acquired by one, frankly,” - Olugbenga Agboola

JP Morgan has a balance sheet north of $4 trillion, a 227-year head start, and no microfinance banks. Flutterwave just got one.

So let’s ditch comparisons and see what the sequence for a big private fintech roughly looks like:

1. Build a valuable payments company in a market everyone agrees is promising and complicated.

2. Spend years explaining why the complication is manageable and having like thirty extra slides explaining your business

3. Get close enough to public markets that complexity starts sounding less like ingenuity and more like friction.

4. Add adjacent recognisable elements that broaden the story: bank licences, FX and multicurrency products, stablecoins...

5. Announce those boring things as strategic progress.

Flutterwave has been running this playbook at pace. FX inside Send App through Swap, stablecoins, and a claim that it is engineering “Africa’s largest stablecoin infrastructure.” The Mono acquisition in January was presented as an infrastructure/open banking play with better margins. Bloomberg said at the time that the deal would strengthen earnings and the IPO case. And now a microfinance banking licence is framed as cutting out third parties and keeping the fees.

None of these announcements, by itself, changes what Flutterwave is. But together, they’re building an answer to the only question that matters before an IPO: what kind of company is this?

In April 2024, Agboola discussed hiring executives who could translate tech-speak for regulators. In 2025, the company began emphasising profitability, sustainability, and maturity. The JP Morgan reference does not mean branch banking. It means belonging to the financial establishment.

A company investors admired for navigating complexity now wants to be rewarded for reducing it. That is a reasonable transition every late-stage private company attempts right before it asks the public markets to price it.

The question Flutterwave has not yet answered, the one people ask in closed quarters, group chats, and private channels, is not whether the narrative is coherent. The question is when the narrative produces the event.

See you on Sunday!

Subscribe now

TOGETHER WITH CREDIT DIRECT

Nobody accidentally builds a great business. The best financial decisions are the ones that keep working long after you stop thinking about them. Credit Direct Business grows your funds at 15% p.a. consistently, without asking for your attention.

You built the business. It should return the favour.

Open a Credit Direct Business Account

Lending Is Easy. Treasury Bills Are Easier.

One of the recurring ideas I share in Notadeepdive is that lending is easy. You get some funding. Customer deposits, VC money, a DFI facility, whatever is available. You build a credit model, talk about AI in your TechCabal interview, and aim at the gap in your pitch deck: the millions of retail borrowers big banks ignore.

Getting people to repay is where things get complicated. There is no shortage of Nigerian lending startups that raised money, built products, and genuinely believed in their higher calling of serving borrowers the banks wouldn’t touch with a ten-foot pole.

When things go sideways, the founders will tell you the credit models didn’t work, or the macros turned, or collections were harder than expected. All true.

And it’ll lead us right back to why big banks, with their huge balance sheets and cheap deposits, aren’t more interested in lending in the first place. Every year, we have different answers.

GTCO’s FY2025 financial statements show a loan book of ₦3.13 trillion. 85% of those loans went to corporates. Borrowing to starving writers and overworked accountants, a.k.a retail banking, was ₦249 billion. There are fintechs with bigger retail loan books.

Lending to Nigeria’s army of Small and Medium Enterprises was ₦31 billion.

If GTCO isn’t deploying its ₦12.55 trillion in customer deposits into lending, what is it doing with them?

Buying government securities. Treasury bills, FGN bonds, eurobonds, commercial paper — ₦5.54 trillion worth, a portfolio 77% larger than its entire loan book.

For every four naira a customer deposits at GTBank, the bank lends roughly one naira to another customer. The other three naira go into government securities.

GTCO is the most extreme version of this in the Nigerian banking sector. The bank’s loan-to-deposit ratio is 25% despite the CBN’s directive of 65%. Other tier-one banks run higher, though most are still well below the target. In other emerging markets like Brazil, India, and Egypt, a 25% LDR at a top-tier institution would raise eyebrows.

The incentives and market structure show how commonsensical GTCO’s moves are.

A Nigerian Treasury bill maturing in six months yields 20-22% with no credit risk. You buy the T-bill, it pays you on schedule, and you go home.

A corporate loan yields maybe 25-28%. For that extra 3-6%, you take on credit risk. GTCO’s loan impairment charges in 2025 were ₦66 billion. The securities book had impairment charges of ₦114 million. Not billion. Million.

GTCO’s loan book earned ₦559 billion gross, roughly ₦493 billion net of impairments. The securities book earned ₦807 billion gross, roughly ₦807 billion net.

To match what the treasury desk produces from government paper, GTCO would need to add another ₦3 trillion in credit, hire the people to underwrite it, set aside the capital, absorb the defaults. Or it could just buy more treasury bills.

GTCO’s deposit base costs almost nothing to maintain. Retail savings accounts (₦2.99 trillion in deposits) pay low single-digit interest. Corporate current accounts (₦5.57 trillion in deposits) often pay nothing at all. A bank getting deposits at 2-4% and buying T-bills at 22% does not need clever financial engineering.

Banks are not failing to lend because they are timid or incompetent. They are making rational capital allocation decisions and the highest risk-adjusted return available to a Nigerian bank with a large deposit franchise is not consumer credit or SME lending. It is government securities.

There is a version of this argument that is a moral case against GTCO and banks like it. Nigeria needs credit, and banks are hoarding deposits in government paper, starving the private sector of capital.

The banks will respond by asking, “ Who should we lend to?

With 85% of the loan book in corporates, the bank is already lending to the creditworthy part of the economy. When it lends to retail customers and SMEs, the impairment experience is materially worse; retail loan impairments relative to the retail book are significantly higher than corporate impairments relative to the corporate book.

There may not be enough creditworthy private-sector demand to absorb what banks are putting into securities. A T-bill yield of 22% is the government competing for the same pool of capital. At those rates, any private borrower needs to generate returns well above 22% after accounting for risk, and the number of Nigerian businesses that can credibly do that is smaller than anyone would like to admit.

GTCO’s E-business income — revenue from digital transactions, electronic payments, and internet banking — grew 14% to ₦64.7 billion. The bank earned more from digital channels than from lending to retail and SME customers combined.

A final thought.

The 2025 Tax Act introduced withholding tax on short-term investment securities aimed squarely at the income source banks like GTCO rely on most. GTCO’s effective tax rate went from 19.6% to 29.7%.

The bank’s tax bill jumped from ₦248 billion to ₦365 billion and while Profit Before Tax barely moved (₦1.23 trillion), Profit After Tax fell from ₦1.02 trillion to ₦866 billion. The entire decline in profit is tax.

If banks are going to use customer deposits to earn 22% on government paper instead of lending, the government will tax the spread. Whether it actually shifts behaviour is unclear because the pre-tax return on securities still beats the risk-adjusted return on lending.

GTCO declared a final dividend of ₦11.76 per share, bringing the full year to ₦12.76, a 59% increase from 2024 and a four-fold increase in shareholder payouts in three years.

Say what you will, but GTCO’s shareholders will have no complaints.

Share

See you tomorrow!

Subscribe now

TOGETHER WITH CREDIT DIRECT

The goal hasn’t changed. You just needed the right system.

Target Yield gives your ambitions a number, a timeline, and 15% p.a. to close the gap. You set the pace. We do the compounding.

Reach Your Goals Faster

Lending is not the footnote

When Moniepoint announced its acquisition of restaurant software startup Orda, the number that travelled fastest was this: Nigerians spend about ₦8 billion a day at restaurants on Moniepoint’s rails. It is a good number, but it’s probably the wrong way to think about the deal.

Annualise it, and you get roughly ₦2.92 trillion. It sounds enormous until you place it beside the ₦412 trillion Moniepoint says it processed across 14 billion transactions in 2025. On this math, restaurant payments are worth about 0.71% of the total. Will one of Nigeria’s most important fintechs buy a specialist restaurant software company just to make payments flow a little more neatly?

So this probably is not mainly a payments story but a lending story.

Moniepoint says it disbursed over ₦1 trillion in credit to around 70,000 businesses in 2025 (an average of ₦14.3 million per business). If you are lending at that scale, you need visibility into more than just payments. You need to know if those businesses should be taking loans in the first place.

Payment data is very useful. It tells you how much money moves through a business, how often it moves, when sales spike, and whether the merchant looks busy enough to deserve credit. That is why fintech lenders love it.

But payment data also has blind spots. It can tell you that a restaurant is selling a lot of food. It cannot, by itself, tell you whether the restaurant is making money on said food. It does not show ingredient waste or margins collapsing because supplier prices have soared. It does not show that the highest-selling item on the menu is also the least profitable.

I exclusively reported that Moniepoint had taken Shoprite to court over a ₦2.4bn working capital loan in December 2025. Last month, a ₦4.38 billion working capital loan to Alerzo also ended in front of a judge.

Orda is not a generic bookkeeping tool for restaurants. It sits deeper in restaurant operations: point of sale, inventory, ordering channels, websites, business analytics, and restaurant workflow. TechCabal reported that more than 1,075 restaurants relied on Orda in 2024 and that it processed more than 5.2 million transactions that year. The data of those restaurants won’t transform Moniepoint’s scale, but the data inside those restaurants is more revealing than raw payment data.

When Moniepoint’s business management tool Moniebook was in beta in late 2025, a company executive said the tool sends “real-time operational data to the credit team, including transaction counts tied to specific products, inventory turnover rates, margin health, and peak sales hours.”

It felt like the company was telling us what problem it is trying to solve: lending with deeper operational visibility, not just terminal data. Orda solves that.

Orda’s ambition was never modest. In 2022, its CEO said he wanted to build the “Toast of Africa.” It had its eye on becoming an embedded-finance solution disguised as software. The revenue of American restaurant software technology company Toast for 2025 shows why. It booked $6.153 billion in total revenue last year, including $5.037 billion from financial technology solutions and $936 million from subscription services. Restaurant software is important, but the bigger prize is what the software lets you do: process payments, offer financing, and capture more of the merchant’s financial life.

Of course, cynics will point out that SaaS alone is a difficult business when your customers are small restaurants, and your pricing is necessarily low. TechCrunch reported in 2022 that Orda’s pricing ran from about ₦1,000 to ₦20,000 per month, depending on plan.

Even without knowing Orda’s exact current pricing mix, software revenue alone was unlikely to create a venture-scale outcome. The real value sat in the operational data and in the possibility of attaching payments and credit to it. Moniepoint already has the rails, the merchant base, and the lending engine, and Orda has the vertical software. The combination is interesting.

If my reading is right, then the story is that the next stage of fintech lending in Nigeria will be won by the company that sees payments and operations, a.k.a Moniepoint is trying to turn operational data into an underwriting advantage.

Will better visibility produce better loans, or just better explanations after some of them go bad? We’ll find out soon enough.

Subscribe now

TOGETHER WITH CREDIT DIRECT

So you’re a freelancer. The government has noticed.

Creators, consultants, and independents - the new tax laws affect how you earn, how you file, and how much you keep. Also, with the March 31 closer than it feels, this is the conversation you need to be having right now.

Watch the detailed breakdown between our Head of Finance and Strategy, Dr Emeka Ucheaga, and Abiodun Kayode-Alli, Senior Tax Consultant at PwC.

Watch on YouTube

You have three months to subscribe

Notadeepdive covers Nigerian technology and business for some 5,000 subscribers. Some of you have been kind enough to say this newsletter deserves something like 10,000 instead. I agree.

So I’m setting a hard deadline of June 13, 2026 — three months from today — for Notadeepdive to hit 10k subscribers. If we do not get there, I will shut down the newsletter permanently. No extensions.

I’m kidding. Obviously.

But I bet your first instinct was probably: he’s not serious, that deadline will move, let me keep scrolling.

And if you felt a flash of alarm at the thought of this newsletter shutting down permanently, send me money it might have been followed by my strong-arming you. While the goal is reasonable and the timeline is ambitious, the real problem is that the consequences fall entirely on you, the audience, rather than me, who failed to plan.

If it sounds all too familiar, you’re likely a traumatised Nigerian.

On October 26, 2022, Nigeria’s Central Bank announced that old ₦200, ₦500, and ₦1,000 notes would stop being legal tender on January 31, 2023. Therefore, Nigerians had three months to swap old notes for new ones. The timeline was unrealistic and more than a few reasonable people said so, but the CBN held its ground.

The cash shortage that followed triggered protests across multiple states, severe disruption to daily commerce, and widespread hardship. Ultimately, the Supreme Court ruled the deadline was unconstitutional; old and new notes ended up circulating side by side.

It will go down in history as cruel enforcement, when humanity and common sense could have delivered better results.

Last week, we saw another example that shows Nigeria’s institutions learn nothing from policy execution failures. The Federal Airports Authority of Nigeria had been discussing the elimination of cash payments at airports since at least mid-2025, when its managing director outlined an automation strategy for airport revenue collection.

By September, FAAN had partnered with Paystack to pilot contactless payments at Lagos and Abuja airports. In November 2025, the Accountant General of the Federation issued a timeline for all Ministries, Departments, and Agencies (MDAs) to stop accepting physical cash for government revenue.

Fast forward to February 27, 2026, and FAAN confirmed that the cashless system would be fully enforced across all airports from March 1, meaning the last public push came only days before full enforcement. From that date, every motorist entering an airport would need a prepaid FAAN card, an e-tag, or a bank card to get through the toll gate. No card, no entry. Cash, which is how the overwhelming majority of drivers had paid the ₦500-to-₦1,000 access fee for decades, would no longer be accepted.

You’re welcome to guess how that played out.

In 2020, the deadline to link SIM cards to National Identification Number (NIN) was repeatedly extended for years as the NCC discovered that tens of millions of subscribers hadn’t complied. Bank Verification Number enrollment deadlines drifted from 2014 onward.

In every case, the arc is the same: hard deadline, mass unpreparedness, chaos or extension, then a reversion to a phased approach that should have been used from the start. FAAN’s March 1 enforcement only added another data point to the pattern.

After years of deadlines, reversals, and extensions, government deadlines in Nigeria have lost their power to shock. The rational response for many Nigerians is to treat a government deadline as a negotiating position.

When FAAN set a March 1 deadline, many motorists didn’t prepare because experience told them the date would shift. When it didn’t, the system buckled under the weight of people who had rationally concluded, based on precedent, that the government was bluffing.

By March 4, President Tinubu suspended the policy at a Federal Executive Council meeting, with the aviation minister explaining that the President acted “out of empathy.” A day later, FAAN officials had vacated the toll gates, and vehicles were driving through without paying.

A hybrid system has now gone live with cash and cards accepted, a phased arrangement that should have been done from the start. To be fair, FAAN’s spokesperson said the original plan was a phased rollout, but the AGF’s circular gave agencies 45 days to deploy electronic alternatives. A government-wide rule, designed for hundreds of agencies with wildly different operating realities, was applied without any translation layer or nuance, and of course, we found ourselves where we always find ourselves.

I’ll now be taking new subscribers while continuing to write the newsletter.

Share

See you on Sunday!

Oh, wait! I worked on this 2025 Impact Report for CcHUB and I’d love for you to read it!

Leave a comment

Subscribe now

TOGETHER WITH CREDIT DIRECT

The tax reforms have been passed. How prepared are you? March 31 is the filing deadline for employed individuals. June 30 is the corporate deadline for business owners. Both are closer than they feel right now.

Our Head of Finance and Strategy, Dr. Emeka Ucheaga, sat down with Abiodun Kayode-Alli, Senior Tax Consultant at PwC, for a conversation that cuts through the noise, what the new reforms actually mean, what they change for your business, and what you should be doing before the deadline arrives.

Watch The Full Conversation

Kill bill

The bill to establish a Nigerian Fintech Regulatory Commission is hard to take seriously as policy, but it must now be taken seriously as politics.

When I first wrote about it in November 2025, it was a telecoms-era regulatory thinking dragged into fintech, with not enough editing. The text had fintechs paying for “spectrum” and defined fintech so loosely that a bank with a mobile app could qualify. Most importantly, it proposed planting a brand-new regulator on top of the Central Bank of Nigeria, which already licenses and supervises payment service providers, mobile money operators, switches, gateways, payment banks, and most of the machinery that makes digital payments work.

Despite the bill’s many problems, it has momentum.

On March 2, the House of Representatives held a public hearing across five joint committees. Speaker Abbas Tajudeen opened the session and described the proposed commission as “complementary” to existing regulators. The bill’s sponsor, Hon. Fuad Laguda, was also on hand.

Who wants this and why

One thing that everyone at the public hearing seemed to agree on is the need for regulation. Where opinions diverge is between people who already have a route into the current regulatory order and those who do not.

OPay’s Maxwell Loko warned that a parallel regulator would mean duplicated licensing, higher compliance costs, and investment uncertainty. He recommended a single lead regulator anchored by the CBN, with clearer inter-agency coordination around it.

FairMoney’s Henry Obiekea was more diplomatic but arrived at the same conclusion: dual oversight would mean more procedural friction and room for contradictory instructions.

By and large, the licensed fintechs don’t want this bill.

On the other side of the divide are the Association of Telecommunications, Information Technology, Cable Satellite Network Operators and Allied Services Employers of Nigeria (ATICEN) and the Association of Mobile Money and Bank Agents in Nigeria (AMBAN).

These are the infrastructure layer beneath the apps, and they believe the CBN has built a regulatory architecture that focuses only on a handful of companies, with everyone else shuffling for attention.

Nigeria’s digital finance infrastructure is wider than the list of firms the CBN talks to most often, they argue. These players want recognition and a seat at the table.

Yet, their real grievance has not magically produced a good law.

Section 31 of the bill requires all fintech operators to obtain an NFRC licence even if they already hold licences from the CBN or SEC. On the bill’s logic, the entire industry will become retroactively unlicensed on Day One. One stakeholder at the hearing flagged this and recommended an initial compliance window rather than criminal sanctions.

The bill also gives the commission broad discretion over licence conditions, suspensions, revocations, consumer codes, tariffs, and competition matters, authorities other agencies already exercise. It is one more regulator added to the pile, with enough overlapping powers to guarantee turf wars.

Three days after the House hearing, the Senate went in the opposite direction. Senator Adetokunbo Abiru, chairman of the Senate Committee on Banking, Insurance and Other Financial Institutions, said fintech should be placed explicitly under the CBN’s supervision through an amendment to the Bank and Other Financial Institutions Act (BOFIA). Strengthening BOFIA and modernising the CBN’s existing powers, he argued, would be more effective than creating a standalone agency that duplicates functions and fragments authority.

Senator Abiru’s position is a sensible legislative articulation of the alternative case that the existing framework for regulating needs updating. But the answer is not a version of the NCC for Fintechs.

The CBN appears to be thinking along similar lines. Its February Fintech Policy Insight Report proposed a Standing Fintech Engagement Forum, a Single Regulatory Window for licensing coordination, an expanded sandbox, and a shared compliance utility. You can disagree with the CBN about many things — and many people do — but this is a better plan to improve coordination.

Ultimately, the best argument for the fintech regulatory commission bill is political representation.

If the National Assembly wants to force a conversation about who gets seen in Nigeria’s fintech architecture, that is a useful fight. Agents and infrastructure providers have legitimate grievances about a system that treats them as an afterthought. But if the claim is that a new commission is the best way to regulate a fast-growing sector, it should be laughed back into committee.

This bill has stayed alive because it gives several constituencies something the current system does not: recognition, access, and maybe a future lever of influence. That is often enough to keep a bad bill moving.

Subscribe now

TOGETHER WITH CREDIT DIRECT

The tax reforms have been passed. How prepared are you? March 31 is the filing deadline for employed individuals. June 30 is the corporate deadline for business owners. Both are closer than they feel right now.

Our Head of Finance and Strategy, Dr. Emeka Ucheaga, sat down with Abiodun Kayode-Alli, Senior Tax Consultant at PwC, for a conversation that cuts through the noise, what the new reforms actually mean, what they change for your business, and what you should be doing before the deadline arrives.

Watch The Full Conversation

Canal+ Was Always Going to Kill Showmax

In February 2024, I was in Johannesburg for the launch of Showmax 2.0, a black-tie event that was a masterclass in branding.

The gist of the launch was that MultiChoice was finally ditching its aging in-house tech, after writing off $65 million on a failed technology modernization project, to jump into bed with Comcast’s NBCUniversal.

With Showmax 2.0, the continent was getting a streaming service with Peacock’s world-class tech, a deep library of local content, a pipeline of HBO and Universal content, and the crown jewel that is the English Premier League on mobile for a subscription price that undercut the global streamers. The target was 50 million subscribers and $1 billion in revenue in five years.

“[It is] the beginning of what the company hopes will be a long march into dominating and making a solid business of African video streaming,” I wrote at the time.

That long march has now been truncated. On March 5, 2026, MultiChoice sent that email to customers. “The Showmax Board has taken the decision to discontinue the Showmax service in the near future,” part of that email said.

All said, Showmax 2.0 lasted two years.

The immediate reaction was that streaming doesn’t work in Africa, data costs are too high, and consumers can’t pay. None of that is wrong, and there’s already a good analysis of those factors. But the more interesting story is about two business models that were never going to coexist and about how anyone who understood Canal+ could have predicted this outcome the moment it crossed the 35% ownership threshold in MultiChoice.

Canal+ was always going to kill Showmax.

How MultiChoice arrived at streaming

MultiChoice’s pay-TV business appeared to have peaked in 2023. For the South African business, stage 4 of loadshedding caused considerable churn, even among customers with disposable income. By FY25, Zambia, Zimbabwe, and Malawi were experiencing severe power shortages.

Meanwhile, paying Showmax subscribers grew 68% year-on-year in FY22. Showmax Pro (the tier with live sports) doubled its subscriber base in FY23. At various points, Showmax reportedly had more subscribers than Netflix across sub-Saharan Africa.

It was easy to interpret it as part of a global trend of cable and satellite TV losing market share to streaming. MultiChoice’s customers were migrating from dishes to screens, the thesis went, and the question was whether MultiChoice would own that future or be disrupted by it.

MultiChoice had content — 91,470 hours of it in more than 45 languages — a SuperSports rights portfolio spanning the EPL, Champions League, and LaLiga, and was operating in 50 African countries. The feeling was that dominance would be inevitable once it had the right technology.

The Vice: Assumptions vs. Hard Reality

In FY2024, Showmax’s trading losses stood at $141 million on revenue of $55m. In FY2025, losses ballooned to $274 million on revenue of $42m. Showmax was spending more than $6 for every $1 it brought in.

The relaunch alone cost approximately $180 million, including $91 million to customise Peacock’s tech for Africa. It also paid quarterly licensing fees to Comcast. In FY24, NBCU exercised its contractual right to sell its 30% Showmax stake back at a predetermined price of $160 million. Canal+ is now writing down $85 million to dissolve the relationship entirely.

Showmax, which accounted for roughly 2% of group revenue, wiped out nearly half the group’s profitability in FY25.

MultiChoice was now losing on two fronts.

In March 2025, MultiChoice lost 2.8 million linear subscribers. Nigeria, which once drove 44% of Rest of Africa revenue, was hit with FX volatility and inflation. MultiChoice’s Rest of Africa revenues fell 44% in dollar terms with a trading loss of R760 million on a reported basis. The segment that had finally turned profitable in FY23 was back in the red within two years.

So MultiChoice was caught in a vice. The old business was shrinking. The new business was hemorrhaging cash, and the macroeconomic environment was actively destroying both.

Canal+ was never going to keep Showmax

Canal+ is not a standalone streaming platform and has never been one. Understanding this is the key to understanding why the Showmax shutdown wasn’t a reaction to bad results. It was baked into Canal+’s business model from the beginning.

Canal+ launched myCanal in December 2013 as a streaming app for its French subscribers. But the platform was designed as an aggregator with one interface through which subscribers could access Canal+’s own channels and third-party services.

By 2019, Canal+ had bundled Netflix into its French subscription tiers. By 2020, Disney+ was included for Ciné Séries subscribers on launch day. Paramount+ and Max followed. Apple TV+ came in 2023.

Canal+ CEO Maxime Saada has described the company’s relationship with Netflix as “80% partners and maybe 20% competitors.” He credited Netflix with doubling France’s paid television market, growing penetration from 30% to 75%. This is not a company that views Netflix as the enemy.

The Canal+ model is basically to avoid competition with global streamers but aggregate them instead. You’ll take a margin on distribution and layer in your own premium channels and local content on top. All the while, you own the customer relationship.

Showmax’s model was to compete directly with Netflix, Amazon, and Disney+ for subscribers and content. It built a proprietary content pipeline and licensed expensive third-party content from HBO, Warner Bros, and Sony.

These two models are structurally incompatible. You cannot simultaneously compete with Netflix (Showmax) and bundle Netflix (Canal+). You have to pick one.

Canal+ picked its model decades ago, and it has already demonstrated how it deploys this model in Africa.

In Francophone Africa, where Canal+ has operated for more than 30 years across 19 countries, it runs the Canal+ app with local and international content aggregated through a single subscription. In June 2025, just months after completing the MultiChoice acquisition, Canal+ struck a strategic Netflix bundling deal for 24 sub-Saharan Francophone African countries. Canal+ became the first operator to bundle Netflix subscriptions into traditional pay-TV offerings across the region.

The NBCU partnership made the structural incompatibility worse. The joint venture gave Comcast — a company with no strategic alignment with Canal+ — a 30% equity stake in MultiChoice’s streaming asset, ongoing licensing fees, and embedded cost structures that Canal+ couldn’t control. Canal+ was subsidising a third party’s position inside its own newly acquired business.

Then there’s the math. Canal+ acquired MultiChoice at R125 ($18) per share, valuing the group at approximately R35 billion ($2 billion). To justify that premium to its own investors, Canal+ committed to delivering R7.5 billion ($417m) in annual cost synergies from the combined group.

That’s just corporate speak for finding money. The single fastest way to find R7.5 billion in a business is to stop spending $272 million a year on a loss-making streaming service.

Saada was blunt about it. In January 2026, he told investors Showmax was “not a commercial success; it’s quite obvious.”

CFO Amandine Ferré added that the losses were “not acceptable.” David Mignot, the new MultiChoice Group CEO appointed by Canal+, told TechCentral just two weeks before the shutdown that Showmax “can’t continue” in its current form. His exact words: “Financially speaking, business-wise speaking, the thing is not flying.”

Canal+ had been in control for less than six months when it finally pulled the trigger.

Calvo Mawela stood on that stage in Johannesburg and described the beginning of a long march. He was right about the march. He was wrong about the direction.

Share

See you on Sunday!

Leave a comment

Subscribe now

TOGETHER WITH CREDIT DIRECT

Nobody builds generational wealth by accident. It always starts with a thoughtful decision, not about today, but tomorrow.

Credit Direct Business grows your funds at 15% p.a., while you focus on building everything else.

Build the foundation for generational wealth today.

Sign Up On Credit Direct Business

A ₦62.56 billion Impairment on MTN’s fintech hopes

The cat’s out of the bag: MTN Nigeria’s full-year revenue for 2025 was ₦5.2 trillion.

To put that in perspective, Seplat Energy, which just posted a record year off the back of a transformational offshore acquisition, did $2.73 billion in revenue. At the average 2025 exchange rates, that is roughly ₦4.1 trillion. BUA Cement, another trillion-naira club member, did ₦1.18 trillion.

On the strength of those results, no Nigerian executive locked in harder than Karl Toriola in 2025.

So I won’t bore you with the top-line and bottom-line figures. You’ve seen those already. Let’s talk instead about the juicier bits.

Fintech ambitions

For most of the year, if you are a massive telecom company like MTN Nigeria, you can talk about “fintech ecosystems,” “strategic pivots”, and “financial inclusion.” These are all good words.

They make investors think of M-Pesa or PayPal. But eventually, the fiscal year ends, and you have to look at your subsidiaries (MoMo Payment Service Bank, Yello Digital Financial Services, and dormant XS Broadband)—the sidecar companies you built to conquer the future—and ask: “If I tried to sell this today, would anyone give me what I said it was worth?”

In 2025, MTN Nigeria looked at its fintech subsidiaries and decided the answer was “No.” Or, more specifically, “₦62.56 billion less than we thought.” Investment in subsidiaries fell from ₦102.95 billion in 2024 to ₦45.39 billion in 2025.

All of this can be confusing when you consider that MTN’s fintech revenue grew by nearly 80%, which sounds like a rocket ship. But if you look at the 9M 2025 investor presentation, you find that almost all of that growth is “XtraTime.”

I’ve talked about XtraTime in a previous newsletter; a very clever product where MTN lends you airtime because you’ve run out and need to make a call. In the accounting world, this is fintech revenue. A more cynical person will call it a high-margin convenience loan to your customers. It’s a great business, but it isn’t disrupting payments.

Once you strip out airtime lending, the rest of the fintech business—the part that’s supposed to be the next OPay—brought in ₦6.8 billion.

For a company that reported ₦5.2 trillion in total revenue, ₦6.8 billion is a rounding error. It’s the loose change found in the couch cushions of a giant.

MoMo had 3.7 million active wallets at the end of 2025, miles away from its target of 30 million to 40 million.

In Q1 2025, active wallets actually fell to 2.1 million before recovering later in the year.

It is not surprising that the company’s Finance & Investment Committee discussed Fintech Structural Separation and Fintech Capital Injection. There was also discussion around the assessment and status of the company’s fintech investment. An ad hoc committee met specifically to discuss Fintech Strategy.

Those are not the agenda items of a business gliding elegantly toward destiny.

Share

TOGETHER WITH BUSHA

If you are a business exploring digital assets for cross-border payments or treasury management, you should check out Busha Business. Busha business also allows you to buy, sell, receive, and send stablecoins and digital assets.

Explore Busha Business

The PSB Trap

One problem is that MTN’s Mobile Money business (MoMo) is playing with one hand tied behind its back. They have a Payment Service Bank (PSB) license. In Nigeria, a PSB is a bank that is allowed to do all the boring stuff (accepting deposits, moving money) but none of the profitable stuff (lending).

The magic of fintech and the thing that makes companies like Nubank or M-Pesa so valuable is the Credit Loop. Theoretically, they see how people spend, so they know who to lend to. But a PSB isn’t allowed to lend.

So MTN is essentially running an expensive digital wallet in a market where OPay and PalmPay have already figured out the moving money part, and MTN isn’t allowed to offer the lending part that could make people switch.

So when MTN starts talking about structural separation for fintech in Nigeria, it is worth being careful not to read too much into it. A separation might make the business easier to fund, value, or reshape if regulation changes. But separation is not, by itself, a strategy.

You can spin it out tomorrow, and it still wakes up as a PSB in a market where OPay and PalmPay are already far ahead on consumer payments, and where MTN still does not have the credit piece that makes this story really sing.

What we have here is a formal acknowledgement that the ambition and the reality are still far apart

A rising tide lifts all boats

Away from fintech, the core telecom business got help from a much better operating environment.

MTN went from a ₦400.4 billion loss after tax in 2024 to a ₦1.1 trillion profit after tax in 2025. A big part of that swing came from foreign exchange. In 2024, the company booked a ₦925.4 billion net FX loss. In 2025, it booked a ₦90.3 billion net FX gain.

That is a swing of just over ₦1 trillion.

MTN was not the only company to benefit from that shift. As we saw recently with Jumia’s Q4 2025 results, once macro stops trying to kill companies every quarter, things can start looking good. MTN still had to execute, but it also had the good fortune of operating in a year where FX was a lot more stable.

N.B.: Are airtime and data elastic goods?

MTN’s numbers suggest airtime and data are not especially elastic goods in Nigeria, at least not at the 2025 price point. People paid more and kept using more. That does not automatically vindicate the operators’ original 100% ask. It just tells you the approved 50% increase did not come close to breaking demand.

Active data users grew to 53.2 million, while average usage per subscriber rose to 13.1GB.

Nigerians paid more and still used more. That is a useful thing to know about the telecom business in Nigeria.

See you next weekend!

Subscribe now

TOGETHER WITH CREDIT DIRECT

Needs don’t send a calendar invite. They show up on a Thursday. Unannounced. Inconvenient. Expensive.

Credit Direct Checkout makes sure your answer is always yes. with up to ₦1M in instant credit, so you complete the purchase now and stay in control of how you pay.

Because “the timing wasn’t right” is the most expensive sentence in the English language.

Know Your Limit

First, it started with Alerzo

On Thursday, I saw news that Ibadan-based B2B e-commerce startup Alerzo was selling off its delivery fleet in connection with a ₦4.38 billion debt it owes Moniepoint. The story turned out to be wrong. Alerzo’s founder told Technext the company was disposing of damaged, non-functional vehicles from its fleet of about 400, something it’s been doing for six months. The publication has since amended the piece.

It was, of course, instantly believable. Alerzo has been in the news for struggles since 2023: layoffs, cost-cutting, and a Federal High Court asset freeze in connection with said working capital loan from Moniepoint. It has rarely addressed the issues and one of the dangers of silence is that people fill in the gaps for you, and they are rarely charitable when they do.

But that’s probably unfair to Alerzo specifically. With the notable exception of OmniRetail, the entire B2B e-commerce sector seems to just be focused on surviving.

MarketForce shut down its B2B platform entirely, and Sabi pivoted to commodity exports. Vendease abandoned its warehouses. The Wasoko-MaxAB merger, billed as Africa’s largest tech, has already seen a co-founder exit and COMESA opening a competition inquiry.

There have been many articles written on the impossible margins in this business model. Last May, in a piece called “Two Startups Walk Into an FMCG,” which told the story of how Flour Mills of Nigeria put about $8 million into Alerzo and also backed OmniRetail with sharply divergent outcomes so far.

But today I'm not thinking about who's winning and losing, but what the future of this sector looks like.

The core problem was never that founders were foolish. It's that venture capital returns from wholesale distribution economics are likely a long road. Credit was supposed to fix that. Then data. Now the sector is trying private labelling. That's the most interesting bet yet and also the one most worth interrogating.

Why the margins are brutal

Warren Buffett owns McLane, one of the largest wholesale distribution companies in the United States. It moves about $50 billion in revenue annually. Buffett has said it's a business that gives Berkshire Hathaway steady, reliable income.

A senior executive at one of Nigeria's major B2B e-commerce players pointed this out to me recently, unprompted. Distribution, he argued, is a model that works. It generates long-term, compounding returns. The problem — and it is the whole problem — is the margins.

FMCG distribution in Nigeria is a 2-5% gross margin business. The people who've done it successfully for decades understand this and built accordingly. Traditional distributors run lean: fewer than ten full-time staff, no delivery unless the retailer buys in bulk, no tech. They survive precisely because they never tried to make distribution better than it is.

Startups took a different view and layered an entirely different cost structure on top of those same thin margins. VC-grade salaries. Engineering teams building apps. Product managers. Growth marketers. Customer acquisition subsidies, discounting products to win retailers from the analogue guys. Two hundred vehicles. Twenty warehouses. Full-stack logistics. All funded by venture capital, expecting 10x or 20x returns.

The traditional distributor spending ₦5 million a month to move product was being outbid by a startup burning ₦50 million a month to move the same product, to the same retailers, at the same or lower prices. The startup had the better app, the nicer truck, and frankly, the better idea.

But the margins didn't budge. If you make a 3% gross margin on a ₦10,000 order, that's ₦300. Out of that ₦300, you need to cover picking, packing, loading a vehicle, driving through Lagos or Ibadan traffic, finding a retailer who may or may not be at the address they gave you, unloading, and getting the vehicle back.

The asset-light question

The received wisdom in the sector has been that the winners will be asset-light players that own no warehouses and no vehicles; they’ll plug into third-party logistics instead. OmniRetail’s success story is often told this way; it runs a network of 1,100 third-party vehicles and 85 partner warehouses.

The executive I spoke to pushed back on this. “You cannot distribute physical products without physical infrastructure,” he said. “I’ve seen a lot of people talk about 3PL and all those things.”

This is one operator’s view, and it’s worth noting he has obvious reasons to defend asset-heavy models. But the logic is hard to dismiss entirely.

If you’re using third-party logistics, someone still owns those vehicles and warehouses, and that someone needs to be paid. You might avoid the capital expenditure, but you’re paying for it in per-delivery fees, and you lose control over service quality, timing, and routing. In a business where margins are already thin, giving up cost control on your single biggest expense line can be tricky. Maybe the question isn’t “should someone own the infrastructure?” It sounds like it should be “can you reach the density where owning it starts paying for itself?”

He drew an analogy to telecoms. A telecom company investing in fibre doesn’t make money in month one; the upfront cost is enormous. But when you reach the point where one delivery vehicle is supplying 50, 100, 200 customers in the same area, loaded from morning to evening, dropping off for one retailer and the next one is two minutes away, that’s when the economics flip.

“You need time to get there,” he said. “It’s not something you just do from day one.”

This is the central tension. The distribution model probably does work at sufficient density and scale; Buffett’s McLane proves it. But getting there requires the kind of patient, long-term capital that venture-backed startups burning through runway simply don’t have.

So the sector went looking for something to subsidise the wait.

TOGETHER WITH BUSHA

If you are a business exploring digital assets for cross-border payments or treasury management, you should check out Busha Business. Busha business also allows you to buy, sell, receive, and send stablecoins and digital assets.

Explore Busha Business

The search for a cash cow

The B2B e-commerce sector in Africa has spent the last five years searching for a cash cow; some adjacent business that generates real profit to subsidize the distribution engine while it scales toward density.

The first answer was lending. The second was data. The third, which I’ll get to, is private labelling. None of them has been easy.

The lending thesis was elegant. You’re delivering inventory to retailers weekly. You know exactly what they buy and how quickly they restock.

So you can lend to them with confidence, either cash or inventory on credit. Distribution is the loss leader; credit is the profit engine. TradeDepot’s $110 million raise was anchored on Buy-Now-Pay-Later for five million SMEs. Alerzo launched its lending product around 2021. In that Flour Mills piece, I noted that at least two major players suffered significant losses from lending and paused their credit programs entirely.

One B2B e-commerce startup I spoke to claims near-zero NPL rates on its pilot lending product. It has refused to scale it. “Someone will buy from you today and not buy from you tomorrow, after taking your product on credit, and go somewhere else,” the executive said. “Even if you’re the smartest person in the world, that is one of the problems you might not be able to solve unless the government finds a way to do it for you.”

Lending to the mass market in Nigeria is expensive even for specialists. FairMoney, the consumer lender, is a useful reference point not because consumer digital lending and merchant trade credit are the same business, but because it shows what underwriting at scale actually costs.

FairMoney grew revenue 62% to ₦121.9 billion in 2024 and turned a ₦7.9 billion profit. But it absorbed ₦59.4 billion in loan impairments that year. It makes the model work by pricing that risk into interest rates, and by spending seven years and $57 million in venture funding building its credit models. B2B e-commerce platforms, already losing money on distribution, never had the luxury of spending years and tens of millions fine-tuning a lending business on the side.

The data thesis had a similar timing problem. B2B platforms are sitting on valuable retailer data: what sells, where, at what price, and how fast it moves. Manufacturers currently spend millions of dollars buying this kind of intelligence from firms like AC Nielsen. In theory, they should be willing to pay platforms for the same insights.

In practice, the executive said, they don’t need to.

“The demand is still chasing the production,” he explained. When a Nigerian manufacturer has three months of backlogged orders and is reporting record profits, they don’t care about your data. They can sell everything they make without it. The data play becomes valuable when manufacturer competition intensifies,” the executive noted, but that moment hasn’t fully arrived.

So neither lending nor data turned out to be the cash cow. Which brings us to the latest candidate: making your own products.

The private label bet

If you can’t make money reselling someone else’s product at commodity margins, the logical next question is: what if you made your own?

That’s what private labelling is. Instead of buying Dangote sugar from a distributor at the same price as every other platform, you partner with a manufacturer — or become one — to produce “your” sugar, or rice, or cooking oil, under your own brand. You control the product, the pricing, and critically, the margin.

The word on the street is that several major players are already doing this. Public disclosures from the Wasoko-MaxAB merger indicate private-label products — cooking oil, rice, tomato paste — now account for over 10% of their combined e-commerce sales. TradeDepot has moved in a similar direction. The trend is not exactly new; African B2B platforms are following a path that retailers globally have been on for decades. But for this sector specifically, it might be the most consequential strategic shift since the original pivot to credit.

Why are private-label margins structurally better? The mechanics are straightforward. When you distribute a national brand — say, Unilever’s Omo detergent — the manufacturer sets the price, the distributor takes a cut, and by the time the product reaches you, there’s almost nothing left.

You’re competing with every other distributor on delivery speed alone. With a private-label product, you eliminate the middlemen and the brand markup. You go directly to a contract manufacturer (or, in some cases, manufacture yourself), which cuts production costs by 40-50%. In the U.S., private-label products yield about 35% profit margins compared to 26% for national brands. McKinsey has found that private labels in distribution can carry roughly double the gross margin of their branded equivalents.

Now, we don’t have precise comparable figures for Nigeria, and it would be dishonest to pretend U.S. economics translate directly. Private-label penetration across Africa and the Middle East sits at just 6.1% of total FMCG sales, according to NielsenIQ versus 36% in Western Europe. The infrastructure for contract manufacturing is less mature. Brand loyalty to national brands among Nigerian retailers is strong. And there’s no getting around the fact that launching a private-label product requires capital for manufacturing relationships, quality control, packaging, and marketing, exactly the kind of capital these companies are short on. It also carries reputational risk: if your private-label rice is bad, it’s your brand that takes the hit, not Dangote’s.

But even if the margin advantage in Nigeria is half of what it is in the U.S. — say, 15-20% gross instead of 3-5% on a branded product — that’s transformative for a sector that’s been haemorrhaging cash trying to make the distribution math work.

The executive I spoke to described his ideal model as “a mix of private label and some sort of direct partnership with a manufacturer. It doesn’t have to be a subsidiary. But some sort of control over the product so you make very reasonable margins.”

The key, in his framing, is that private labelling isn’t meant to replace everything else — it’s meant to generate enough profit to subsidise the distribution business while it scales toward the density where it becomes self-sustaining.

He compared it to how Moniepoint built its business. Moniepoint started with POS terminals, a genuine cash cow, and then layered personal banking, remittances and everything else on top.

“What you need is to find that cash cow,” he said. “Then you start layering up. Some of the layers might be unprofitable. But when you lay them on top of each other over time, you find a way to subsidise.”

For the rest of the sector, private labelling is an attempt to find that cash cow after years of trying credit and data and coming up short. Whether it works depends on things that are genuinely uncertain: manufacturing relationships, consumer acceptance, capital availability, and time. But for a sector that has spent the better part of five years learning what doesn’t work, it at least points the economics in a direction where the answer isn’t permanently negative.

That, for B2B e-commerce in Africa, counts as progress.

If you missed Friday’s Notadeepdive, catch up here. If this newsletter was forwarded to you, subscribe here for free:

Subscribe now

TOGETHER WITH CREDIT DIRECT

Your money sitting idle in a regular account is a quiet inefficiency most business owners overlook.

Credit Direct Business is designed to fix that, offering up to 15% per annum on deposits, while giving merchants a structured home for their Buy Now, Pay Later earnings. It’s not just a wallet. It’s leverage.

Put Your Business Funds To Work

Offline Payments Are The New Battleground for Nigerian Fintechs

On June 23, 2020, during the pandemic, I published an article explaining how Nigeria’s biggest payments companies were racing to launch new online marketplace platforms. The behavioral changes triggered by COVID lockdowns had seemingly created the perfect opportunity to scale local e-commerce while accelerating transaction activities on the payment systems. Flutterwave, Remita, Interswitch, Habari, and OPay made the first leaps by the start of June.

Paystack, the Stripe-owned fintech, announced Paystack Commerce, its own marketplace, minutes after that article. It shared an ambitious roadmap to turn the product into a sophisticated global shopping tool, loaded with invoice features, sales analytics, and integrations with Substack and Google Pay.

These fintechs, equipped with technology to help businesses accept payments, believed they could unlock new growth if only they could get more businesses to sell to customers using digital marketplaces. As compelling as this proposition was, it failed.

Paystack hasn’t added any features since 2022, effectively abandoning the e-commerce play — a rare misadventure for a company that takes a careful approach to product rollout.

The e-commerce platforms of Flutterwave and Remita have also stalled; while OPay shuttered its OTrade and OMall marketplaces after only a few months in operation to focus on its core fintech services. These misadventures highlight the challenges of e-commerce in Nigeria. But it also underscores a fundamental misread of the domestic market as offline businesses rapidly embraced electronic payments while ditching the need for online storefronts.

The Original Premise of New Age Payments Startups

Paystack and Flutterwave are two of the biggest names in Nigerian fintech. But they’ve only been around for a decade. Yet their creation in 2015 and 2016, respectively, heralded the dawn of a rejuvenated Nigerian payments industry by favouring quick API integration and a low-fee model to get more enterprises to accept electronic payments from consumers. Their raison d’être was built on four things:

1. That cash is being digitized, and the future of payments will be electronic.

2. That card payments will be the dominant form of retail payments as financial inclusion — an industry-driven initiative to get more people to use formal financial institutions for their savings and payments needs — scales banking.

3. That e-commerce platforms, which were nascent in Nigeria at the time, that allow people to buy and sell on the internet, will usher in the next era of electronic payments as businesses switch to digital sales channels.

4. And as these changes happen, payment providers can stay in the background, capturing significant economic value as processors without having to be on the ground, since merchants themselves will do all the hard labour to go digital.

But some of these things have played out differently.

E-Commerce Revenue ₦0, Payments Revenue ₦0

On the one hand, Nigeria’s macroeconomic struggles over the last decade greatly destabilized growth plans for local fintechs, their enterprise clients, and consumers’ purchasing power. Yet people didn’t stop spending, nor did it slow the pace of digitizing cash.

Instead, the channels of commerce and the methods of payment changed drastically during this period. In other words, most businesses remained largely offline, with no online footprint, and bank transfers and POS transactions, not pure online payments, became the fastest-growing methods of payment. Fintechs that didn’t get this memo were left for dead or suffered slower growth, especially post-pandemic.

Bank transfers, in particular, represented a big threat for two reasons. Unlike debit cards, still in growth territory and weren’t always efficient at the time, digital banking over smartphones or feature phones was ubiquitous. With a banking app, consumers could send and receive funds in seconds with a real-time alert to verify transactions. With peer-to-peer transfers, a customer can manually send money from their banking app to a recipient’s bank account, removing the need for bank cards entirely. And second, with banks already linked to each other, peer-to-peer transfers completely cut out the fintechs from the value chain.

OPay and Moniepoint were among the earliest fintechs to recognize this seismic change, which accelerated with agency banking. Moniepoint pivoted from its enterprise business model just before the pandemic, while OPay spent huge sums to incentivize consumer behavior towards the peer-to-peer or bank transfer trend. In 2020, mobile money operators and POS transfers accounted for 13% of consumer total payment volume (not value); by 2023, they represented over 40% of transactions.

TOGETHER WITH BUSHA

If you are a business exploring digital assets for cross-border payments or treasury management, you should check out Busha Business. Busha business also allows you to buy, sell, receive, and send stablecoins and digital assets.

Explore Busha Business

Elsewhere, payment processors’ anticipated e-commerce boom never arrived. Jumia, the largest e-commerce platform on the continent, continues to report less than 1% market penetration after a decade. The willingness of consumers and merchants to transact entirely online — the loop from product discovery to consumer payments — never gained traction. Fashion businesses didn’t fully go online, car sales didn’t go online, nor did purchases of consumer goods. All of these things remained offline.

Typing “restaurant near me” in Lagos on Maps is not always so helpful in finding dining options. Googling “best hair salon in Maryland” is futile, and even searching for “plain white shirts” on Jumia most times doesn’t return quality results. Everything remained offline, away from organized storefronts. Yet that didn’t mean people didn’t shop online.

Once a consumer sees a local product while doomscrolling on Instagram, they message the seller, haggle or reach a price, wire the money to the seller via bank transfer, while the seller dispatches the item to the customer using a third-party logistics service. In this transaction loop, from product discovery to consumer payment, e-commerce platforms received zero revenue, and payment providers got nothing. Yet an online trade concluded successfully, but via social commerce and peer-to-peer transfers.

Payments Revenue ₦100, E-Commerce Revenue Still ₦0

As these social commerce and peer-to-peer payments trends accelerated post-pandemic, fintechs glued to their original premise were sure to lose. They all recognized this, but slowly. Then comes the industry shift towards open banking and the creation of “pay with bank transfer”.

This revolutionary new payment method brought fintechs back into the peer-to-peer value chain. With open banking, fintechs can ditch cards and integrate directly with every bank in the country. This method has been wildly successful so far, yet it quickly exposed how many transactions were happening offline, away from cards and digital marketplaces. Everything from school fees payments to paying for stuff at a roadside food vendor is increasingly shifting to P2P payments.

So rather than focusing on getting businesses to sell online, the new goal for fintechs over the last six years is getting businesses that are offline to accept payments omnichannel — via cards, bank transfers, web, POS devices, or mobile money. Fintechs and banks are racing to arm every trader in the market with a POS device. In this value chain, while e-commerce platforms continue to earn zero revenue, payment providers earn a decent take rate.

All of a sudden, fintechs are realizing that the way to accelerate growth in the offline payments realm — to scale it — is to repurpose the original e-commerce playbook, but for offline. In other words, after onboarding merchants to their payment service, offer them working capital loans to scale up their inventory, a high-margin value-added service, to drive sales volume; merchant banking services to manage their business, including software for bookkeeping, payroll, and tax management.

This is what Moniepoint and OPay have achieved successfully over the last few years. Paystack recently started on this path, but is rapidly scaling. It first partnered with Titan Bank, then launched an offline payments service, and now it has launched Paystack Microfinance Bank, a licensing regime that gives it the same regulatory cover as Moniepoint.

Unlike the traditional payments paradigm, fintechs on this offline path are poised for more geometric growth over the next few years. Their success is no longer anchored by any swing tied to Nigeria’s anticipated e-commerce pipe dream. Instead, their growth is tied to broader GDP activities in the domestic economy. In other words, as merchants and consumers switch to these payment providers for their daily transaction needs, these fintechs will keep scaling, and the more sales volume merchants record in general, the faster these fintechs scale.

The upside is massive since the majority of Nigerian commerce occurs in the informal economy, driven partly by small unregistered businesses that sometimes lack the corporate structure to access traditional banking services. But they can use P2P payments to keep serving customers.

For now, fintechs expanding in this direction are going to see a bump in key milestones as they push deeper into this market. And once the industry is at scale, the fortunes of these fintechs become closely linked to Nigeria’s GDP performance. This ensures steady revenue growth for the foreseeable future while ensuring that startups are directly tackling some of the biggest needs of small businesses.

But key risks are lurking for these fintechs. On the one hand, their credit exposure is increasing as they use value-added services like lending to appeal to merchants. On the other hand, the resilience of these startups is impacted by their source of capital. Companies that raised or are considering funding from abroad need to be careful when weighing the ROI against business performance because devaluation in recent years has had an impact on startups’ return profiles.

Nevertheless, the future looks exciting.

See you next week!

Subscribe now

TOGETHER WITH CREDIT DIRECT

Your money sitting idle in a regular account is a quiet inefficiency most business owners overlook. 

Credit Direct Business is designed to fix that, offering up to 15% per annum on deposits, while giving merchants a structured home for their Buy Now, Pay Later earnings. It’s not just a wallet. It’s leverage.

Put Your Business Funds To Work

In Defence Of Nigerian VCs

In January, Terra Industries, a Nigerian defence startup and drone maker, closed an $11.75 million round led by 8VC, with Lux Capital, Valor Equity Partners, SV Angel, and Nova Global also participating. On the face of it, no Nigerian VC was on the cap table, and Nigeria’s next frontier technology was being funded by American defence-tech money.

Predictably, this reignited the favourite pastime of Nigerian tech Twitter: dunking on local VCs. Why didn’t they back this? Where were they? Do they even have vision?

I have written at length — here and here — about the limitations of the VC model in Nigeria, the narrow thesis most funds operate on, the lack of exits, and the valuation games that have burned capital. I stand by all of that.

But the current discourse lacks context. It confuses fair criticism with cheap shots, and it compares Nigerian VCs to their American counterparts without asking the most basic question: are they even playing the same game?

Spoiler: They are not.

A Category That Doesn’t Exist

Terra’s $34 million raise from American defence-tech investors is impressive. It is also a product of an ecosystem that has no Nigerian equivalent.

In the US, companies like Anduril and Palantir operate within a defence-tech market where investors with the right security clearance can deploy billions into companies selling to the Pentagon, NATO allies, and critical infrastructure operators with multi-year government contracts. American defence-tech startups raised $31 billion in 2024 alone. There is an entire government procurement pipeline, anchored by the Department of Defence’s innovation budget, that creates the demand signals VCs can underwrite.

Nigeria has none of this. No structured procurement pipeline funnelling contracts to startups. No defence-tech ecosystem where a VC can back a drone company knowing the military will be a reliable customer. The Nigerian military itself publicly admits it cannot produce its own equipment due to inadequate R&D investment.

So when critics ask why Nigerian VCs didn’t back Terra, they’re asking why funds operating in Lagos didn’t behave like funds operating in a $31 billion category that doesn’t exist in their market. Terra’s original $800K round included African investors: Alpha Gaps, Tofino Capital, Kaleo Ventures, Velocity Digital, and DFS Lab. The $34 million that followed came from a type of capital that Nigerian venture simply does not have access to.

The Capital They Actually Have

Unlike most of the developed world, the typical Nigerian LP is not a pension fund, a university endowment, or a sovereign wealth fund writing nine-figure cheques from a diversified portfolio. The typical Nigerian LP is someone between 45 and 60, with kids settled abroad, who has done well enough in their career to have some disposable capital. Instead of buying another plot of land in Ikoyi or Lekki, they put between $10K and $200K — money that is effectively retirement savings, school fees, or wedding funds — into a venture fund.

They are making a concentrated, high-risk bet on the Nigerian tech ecosystem with money they may actually need.

The domestic capital pool is shallow. The same high-net-worth individuals and family offices that venture funds are courting are also being chased by financial advisors, asset managers, private bankers, real estate developers, and everyone else competing for a thin slice of deployable Nigerian capital. Venture, with its 10-year lockups, no distributions, and binary outcomes, is the hardest sell in the room.

Where institutional money flows in, it largely comes from Development Finance Institutions. DFI capital provides scale that local LPs cannot, but it is not free money. It comes with mandates: financial inclusion, job creation, SME support, gender-lens investing, climate considerations, and measurable development outcomes.

Nigerian VCs who depend on DFI capital cannot freely chase every category. They cannot pile into crypto infrastructure like a US fund. They cannot back a defence startup even if they wanted to. They cannot deploy into categories that don’t fit the impact thesis their LPs signed up for.

Even the best-capitalised funds tell this story. When Ventures Platform raised $64 million for its second fund, its LP base included IFC, British International Investment, Proparco, Standard Bank, AfricaGrow, and European family offices. Most Nigerian funds are working with much thinner bases, where the money behind the fund has a face, a family, and a retirement plan attached to it.

TOGETHER WITH BUSHA

If you are a business exploring digital assets for cross-border payments or treasury management, you should check out Busha Business. Busha business also allows you to buy, sell, receive, and send stablecoins and digital assets.

Explore Busha Business

What They Built With It

Here is what Nigerian VCs actually did with these constraints.

Before Tiger Global wrote a $250 million cheque for Flutterwave’s Series D, someone had to believe that building payment infrastructure in Nigeria was a venture-backable idea. Local VCs and early-stage funds wrote the first cheques into Flutterwave and Paystack without a $10 billion fund behind them. They had conviction built on understanding the market. Paystack was acquired by Stripe. Flutterwave built infrastructure powering e-commerce across 33+ African countries. The payment rails they funded in the 2010s are now the backbone of Nigeria’s digital economy.

Before Andela raised $381 million from Al Gore, Mark Zuckerberg, and SoftBank, some local investors believed Nigerian software developers were world-class and that someone could build a business proving it.

Before Moniepoint raised over $200 million from IFC, Google, and Visa, local investors like Oui Capital, Quantum Capital, and Verod Capital backed a company that now processes $250 billion annually in payments, employs over 4,000 people, and supports millions of merchants, bringing financial services to parts of Nigeria that banks actively ignored.

These sub-$10 million vehicles collectively seeded tens of thousands of direct jobs and the foundations of a digital economy that would have seemed implausible a decade ago.

The Risks Nobody Else Takes

Even when conviction pays off, the return math is structurally capped. Oui Capital’s early bet on Moniepoint — one of the best seed-stage outcomes in African VC history — returned roughly 53x after dilution. That is exceptional by any standard, local or global.

But as Samora Kariuki of Frontier Fintech points out, Africa’s single best fintech outcome, a company processing over $250 billion annually with $600 million+ in revenue, produces a diluted seed return that reflects smaller exit valuations, longer paths to exit, and entry prices that haven’t always accounted for either reality.

Nigerian VCs know this math. They deploy anyway.

They have also backed moonshots that didn’t work. 54Gene raised $45 million to build an African genomics company, backed by local names like Future Africa, Ingressive Capital, and Endeavour Catalyst. Before it shut down, its valuation was slashed from $170 million to $50 million. But the conviction to back African genomics research in a market where less than 3% of global genetic material used in pharmaceutical research comes from Africa, was real.

And they have stomached risks that no Silicon Valley investor has to think about. Founders shutting down businesses after allegedly lavishing investor funds abroad; portfolio companies ending up in EFCC headlines because fraudulent third parties processed money through their platforms; companies failing not because of bad unit economics, but because of wonky policies like okada bans, Naira devaluations, CBN policy reversals, and an unpredictable regulatory landscape.

The mobility and logistics bets alone tell this story. Chowdeck, Gokada, MAX, Kobo360, MVX, Treepz, Shuttlers, Cars45, Autochek…Nigerian VCs funded wave after wave. They watched predecessors die and backed the next one. They saw Lagos ban okadas and kept deploying into adjacent plays. When the same thing happens in Silicon Valley, we call it iteration. When it happens in Nigeria, we call it bad judgment.

I am not arguing that Nigerian VCs are beyond criticism. They are not.

There are real governance gaps in the ecosystem. Reporting to LPs is inconsistent across funds. Some deal terms are more extractive than they should be. There is genuine herd behaviour, although I would argue that doubling down on fintech, the one sector where Nigeria has proven global competitiveness, is conviction more than it is herd mentality.

Narrative clustering in VC is what Warren Buffett calls institutional imperative: when LPs allocate, GPs raise, and deal flow is sourced, everyone needs to be telling roughly the same story. That is how venture capital works everywhere. The difference is that Nigerian VCs had fewer viable narratives to choose from, and the one they chose actually produced real companies.

What is more urgent is the need for realistic exit planning. Building for local M&A, preaching sustainability, developing secondary markets — these matter more than fantasising about IPOs or foreign acquisitions that may never come. The ecosystem needs more transparency, more discipline, and more honest conversations between GPs and LPs about what venture returns in Nigeria actually look like.

But these are criticisms of execution, not of conviction. And they are a different conversation from the one that erupts every time an American fund backs a Nigerian company that local VCs didn’t.

The Real Gap

The Terra episode did reveal something important, but it wasn’t that Nigerian VCs lack vision. It revealed the categories that remain inaccessible to different pools of capital.

One of the local investors in Terra was Resilience 17, a fund owned by Flutterwave CEO GB Agboola. That is a founder who built a $3 billion company, generated personal wealth, and is now recycling it into the next generation of Nigerian companies. In Silicon Valley, the wealth created by early employees at Stripe, Facebook, and Google seeded thousands of angel investors and fund managers. Nigeria doesn’t yet have enough of this founder-to-funder pipeline.

Terra Industries is a genuinely exciting company for Nigeria in 2026, the same way Flutterwave and Paystack were in 2016. The fact that American defence-tech VCs funded them is great for Terra and great for Nigeria. The fact that founders are now recycling wealth into the next generation is even better.

So the next time you want to dunk on Nigerian VCs — don’t worry, I will probably be the one doing it.

But before you do, ask yourself: would you have let your 50-year-old mum or dad invest ₦100 million in Flutterwave or Paystack back in 2016, when Interswitch already existed? Or in TeamApt, when Bluechip, Telnet, and Chams already existed?

Somebody’s parent did. And that bet built the ecosystem you’re tweeting from.

See you on Sunday!

Subscribe now

Notadeepdive is powered by two super supportive brand partners, Credit Direct and Busha. Make sure to check them out!

TOGETHER WITH CREDIT DIRECT

Generosity is great, but strategic generosity changes lives. Gift A Yield transforms your kind gesture into a compounding investment.

By gifting a Yield plan to someone, you aren’t just giving money; you’re giving them a future they can actually use. While other gifts lose value, a Yield plan compounds. It’s strategic, it’s thoughtful, and it’s the only gift that literally pays them back. Give them a financial head start today.

Click Here To Gift A Yield

A great consumer idea loses the fight with unit economics

A few weeks ago, Eden Life’s founder got out ahead of a brewing story about the company’s future. We now have the version with context, and we’ll take it.

Eden Life has now clarified that it’s not shutting down, but making a “strategic transition.” The corporate-speak continues: “We are temporarily de-prioritising our individual consumer (B2C) offerings to consolidate our resources and focus on our high-growth, profitable B2B market.”

The company says its industrial catering and corporate food subscriptions, which it calls “primary growth drivers,” will continue.

This is not a dunk on anyone. Startups are hard, and half the time, they’re trying to conjure from thin air stuff that didn’t exist before. In Eden Life’s case, what they initially built looked like a concierge service: offering Nigeria’s busy working-class the chance to get chef-cooked meals, sort out laundry, and handle home cleaning through trained professionals.

If you’re the kind of person who’s busy enough to use Chowdeck, Glovo and FoodCourt more than 100 times a year, you eventually hit decision fatigue: too many menus, too many choices, only to still end up ordering the same three things. And if like me, you work on weekends, you want someone to come in and do the cleaning and laundry. When you think about it, it was quite a solid idea.

A few of my friends used it after it launched, and I could see how it would play well with the upper middle class as a soft bit of convenience and a status signal (not a bad thing!).

Yet, I wasn’t convinced that the idea would reach critical mass (to be fair, I’ve been known to take the dim view on many things). There was also the small matter of being a poor journalist, so I wasn’t the target market. However, my skepticism was based on something more structural: unskilled/semi-skilled labour is pretty cheap in Nigeria.

Eden Life was up against restaurants, laundromats and a bunch of other businesses, but on some level, it was up against the real alternative: cheap labour. It’s the same reason platforms for aggregating quality/professional artisans haven’t become wild successes (VConnect worked on this for years).

The pitch for a platform like Eden Life is that you’re paying for reliability: trained professionals who won’t waste your time or do a shoddy job. What Eden tried to do was to make a product out of the experience: vetting, training, punctuality, replacements, QA, and customer support. That predictability is the product, but it’s also expensive to deliver.

Compare that to cheap labour. You can hire a mediocre artisan or a live-in cook who cuts corners here and there because firing them and hiring a replacement is easy. So the high cost of “professional and reliable” has to compete with “cheap and good enough,” and cheap-and-good-enough is a brutal competitor.

You also have to factor in Nigeria’s worsening macro environment at the time.

Nigeria’s food inflation hit 40.87% YoY in June 2024 (with headline inflation at 34.19% YoY that same month). It meant inputs get more expensive (ingredients, diesel, packaging, labour expectations). When your customer’s discretionary budget shrinks, they reclassify convenience as a luxury.

Eden got creative, using laundry as the on-ramp to upsell meals. But the fight with the unit economics would have been very tricky. We don’t have their numbers, so we have to get creative.

In 2023, TechCabal reported Eden raised subscription pricing to ₦150,000 for two meals daily. So for 60 meals a month, that’s ₦2,500 per meal in revenue.

Big Quick Service Restaurant operators spend ~50% of revenue on raw materials. Food Concepts Plc reported raw materials/consumables of ₦50.157bn on ₦95.250bn revenue in 2024 (~53%).

Eden is smaller, offers premium, and deals with more variability, so it’s safe to assume raw materials took 55–70% of revenue, something like ₦1,375–₦1,750 per meal. Packaging would be something like ₦150–₦300 per meal (containers, branding, cutlery, sealing).

You also have to deliver the items. Even if the customer pays for the delivery, you have to manage the operations and scheduling. There will be wrong addresses, customers not picking up phones, having to make the same delivery twice, etc.

If we extend our back-of-the-napkin analysis, we could assume:

• Revenue: ₦150,000

• Raw materials (say 60%): ₦90,000

• Packaging (₦200 × 60): ₦12,000

• Delivery + ops: ₦15,000–₦30,000

• Kitchen labour / QA overhead allocation: ₦15,000–₦25,000

That’s ₦132,000–₦157,000 before paying for customer support, refunds, marketing, tech, management, rent, and sundry infrastructure.

Eden soon bolted on a quick service restaurant (QSR) model, listing meals on food delivery apps. But QSR models are engineered for volume because the margins are thin even for established players.

Look at Food Concepts Plc, the group behind Chicken Republic:

Even in 2024, which was a good year for Food Concepts, likely helped by pricing power and naira effects, you’re still looking at single-digit operating margins. That’s with the scale and brand recognition of Chicken Republic behind you. For a startup trying to bolt a QSR model onto an existing concierge play, you can only imagine what the math looks like.

Ultimately, Eden Life couldn’t wrangle positive unit economics serving individual customers as macroeconomic conditions deteriorated. It’s tempting to imagine how this business would have fared with a stronger economy and a larger, more stable upper middle class. But here’s where we are. I wish them luck in the more profitable but 60-day payment cycle world of B2B.

TOGETHER WITH BUSHA

If you are a business exploring digital assets for cross-border payments or treasury management, you should check out Busha Business. Busha business also allows you to buy, sell, receive, and send stablecoins and digital assets.

Explore Busha Business

How much room does the Nigerian household actually have?

In partnership with Risevest

Speaking of inflation squeezing consumers out of things they used to afford, Risevest published its 2025 Cost of Living Report last week, and the numbers put some flesh on the bones of what we’ve been discussing.

The headline finding won’t surprise anyone who’s been paying attention: the macro is improving, but households aren’t feeling it yet. Nigeria’s inflation eased to 18% by September 2025, and we even got our first month-on-month food price decline in over 13 years. A 50kg bag of rice that cost around ₦90,000 in mid-2024 fell to roughly ₦57,000 by October. On paper, it’s real progress.

The survey puts the average Nigerian income at ₦467,268 a month, but that number is puffed up by a small number of high earners. The median, which better reflects what a typical person actually takes home, is ₦200,225. About $125 a month. That’s the reality for most.

Against that, 62% of respondents spend more than 60% of their income every month. One in six spend more than they earn, plugging the gap with savings, borrowing, or informal credit. The estimated cost of living for a family of four in Lagos — excluding rent — is ₦1.24 million monthly, so you start to understand why.

And the cost pressures come from everywhere. Rent surged over 80% in parts of Lagos over the past year. Band A electricity tariffs more than tripled. Fuel sits above ₦950 per litre, which flows into everything from transport to the price of tomatoes. Healthcare costs doubled year-on-year. Each of these individually is manageable for a high earner. Stacked together against a median income of ₦200,000, the arithmetic is brutal.

The one encouraging finding: Nigerians are saving more. The average savings rate jumped from 15% to 21.5%, the sharpest improvement across all four countries surveyed. As food inflation eased, it freed up money that was previously going straight to rice and garri. But it also reflects a population that went through the worst of 2024’s inflation crisis and came out with more defensive habits. People are buying in bulk, cutting non-essentials, and putting money aside with real discipline.

85% of respondents are actively investing in something, with real estate, stocks, and mutual funds leading the pack. The shift toward dollar-denominated assets and digital investment platforms is pronounced — unsurprising when your local currency has lost the kind of value the naira has over the past three years.

The full report covers four countries across 118 pages and is worth reading if you care about how African households are actually navigating this economy — not the macro version, the lived one.

You can read it here.

See you next week!

If you liked this newsletter, please share and like!

Share

Subscribe now

Notadeepdive is powered by two super supportive brand partners, Credit Direct and Busha. Make sure to check them out!

TOGETHER WITH CREDIT DIRECT

Generosity is great, but strategic generosity changes lives. Gift A Yield transforms your kind gesture into a compounding investment.

By gifting a Yield plan to someone, you aren’t just giving money; you’re giving them a future they can actually use. While other gifts lose value, a Yield plan compounds. It’s strategic, it’s thoughtful, and it’s the only gift that literally pays them back. Give them a financial head start today.

Click Here To Gift A Yield

When do shareholders love layoffs?

When you subscribe to Notadeepdive, the broad promise is that you’ll understand Nigeria’s tech scene without the fluff. Somewhere in the fine print, however, is your front-row seat to my healthy obsession with Jumia.

This week, Jumia released its Q4 and full-year 2025 results, so yes: Notadeepdive insiders saw this newsletter coming.

Since it became a public company, every Jumia earnings story has been a predictable song and dance: losses, losses, more losses, how-is-this-company-still-alive. The media fixated on top and bottom lines, the staggering scale of the red ink, and honestly, who could blame them? The numbers were shocking.

But a lot has changed in the last two years since Francis Dufay took the CEO job and began making the kind of pragmatic decisions that Jumia obsessives have been begging for. In 2025, he leaned into the media in a way his predecessors never did: talking more, saying the hard things out loud, not hiding behind corporate boilerplate.

When your CEO openly tells reporters he’s willing to exit countries, cut headcount, and shelve entire product lines, the narrative shifts to “this guy might actually pull it off.”

These days, Jumia is all cost discipline, China sourcing, and a CEO who sounds like he’d fire his own reflection if it wasn’t hitting its KPIs. Investors are eating it up.

When Dufay casually mentioned on this week’s earnings call that the company would lay off even more people in 2026, primarily across technology and G&A, it didn’t make a single headline.

When you’re unprofitable, layoffs are sexy.

That’s an absurd sentence if you dwell on it for even five seconds, because layoffs are never sexy to the people being laid off. But it’s an honest description of how public markets behave. When a company has spent a decade proving it can grow without any care for unit economics, markets reward the first credible signs of economics, even if the path runs through headcount cuts.

Let’s rewind a bit.

Nigeria’s early startup crop (and Africa’s, broadly) was a long parade of “X for Africa” companies—sometimes good companies, other times mediocre copy-paste operations. Jumia, founded in 2012, was the “Amazon of Africa,” backed by Rocket Internet, a firm whose entire business model was to speed-run proven ideas into new markets.

The theory was simple: there’s a huge untapped online shopping market. If you onboard enough users and burn enough VC money subsidising shopping, you eventually end up with such a large market share that you can raise prices, turn off the subsidies, and become profitable.

This famously worked for Uber. It did not work for Jumia.

By 2018, Jumia was in 14 countries, and by its 2019 IPO, it had raised $800 million. Right now, it’s rolling back on those early moves.

It has now exited Algeria (it exited South Africa and Tunisia in 2024), cutting down its operational markets to eight. It has just 2,010 employees, down 7% from a year ago.

Its highest-paid executives, who until late 2022 were sitting in a Dubai office while running an African business, have been relocated to the continent. Its cloud bill has been renegotiated. Its food delivery arm? Dead. Its JumiaPay fintech ambitions? Shelved. What’s left is a leaner e-commerce marketplace that, for the first time, looks like it might actually work.

It has only taken fourteen years, but Jumia has now found product-market fit.

“Jumia operates in markets that remain significantly underpenetrated for e-commerce,” said CEO Francis Dufay on this week’s earnings call.

Fourteen years after the company’s initial assumption that African markets were underdeveloped for e-commerce, it still sounds like day one. Not in that self-congratulatory, fake-humble way startup bros typically use the term.

The underlying numbers have improved, but you’ve got to admit that in the age of AI, shareholders hear “layoffs” and “automation” and figure a company is efficiently deploying resources. It’s even better if you’re promising full-year profitability by next year.

“The message we gave to the teams in all countries is that all business units are expected to deliver scale and profitability in a very reasonable time frame,” Dufay said. “We’re not shy of taking tough decisions.”

Big talk.

TOGETHER WITH BUSHA

If you are a business exploring digital assets for cross-border payments or treasury management, you should check out Busha Business. Busha business also allows you to buy, sell, receive, and send stablecoins and digital assets.

Explore Busha Business

Beating Temu by copying Temu

One interesting subplot in the Jumia story is how it reacted to the Temu and Shein threat.

I wrote in Semafor last year that Jumia acknowledged the competition head-on and began sourcing items directly from China. It opened offices in Shenzhen and, more recently, in Yiwu, one of the world’s largest wholesale commodity markets (if you’ve bought a cheap phone case or a suspiciously affordable Bluetooth speaker at any point in the last decade, there’s a reasonable chance it passed through Yiwu). In Q4, Jumia sold 6.1 million international items, up over 80% year-over-year. It now has roughly 24,000 China-based sellers on its marketplace.

The strategy is almost comically straightforward: Jumia looked at what made Temu competitive—cheap goods sourced directly from Chinese manufacturers—and replicated it.

It also has one crucial advantage that Temu can’t easily copy: several thousand goods sitting in African warehouses, ready for next-day delivery. Temu’s cross-border model ships individual packages from China, which is fine for a $5 pair of earbuds you don’t urgently need, but doesn’t work so well when you want a fridge. Appliances, TVs, and phones make up about 60% of Jumia’s general merchandise. Good luck drop-shipping a refrigerator from Shenzhen to Maiduguri.

Dufay did a small victory lap this week: “We are seeing less aggressive behaviour from certain global entrants in selected countries, including Nigeria, while our local market share continues to build.”

On top of that, the Ivory Coast introduced a new tax on the profits of non-resident e-commerce platforms. Ghana’s VAT Amendment Act now requires cross-border platforms to register for VAT and comply with local requirements. Part of what made Temu’s pricing so competitive—not paying local taxes—is shrinking in several African markets.

Has anyone else noticed that Temu has started offering seven-day delivery on select items to Nigeria, a massive improvement on its two-week-ish shipping? In any case, they’re now on the defensive with Jumia absorbing their playbook while retaining local infrastructure advantage.

The real growth story is not in Lagos

Here’s an interesting number in the entire earnings report: orders from upcountry regions a.k.a underserved, small towns and villages with populations ranging from roughly 20,000 to 150,000, now account for 61% of Jumia’s total volumes, up from 56% a year ago.

In Lagos, Abuja or Nairobi, consumers have a dozen shopping options, and the local trader’s margin is kept in check by competition. Smaller cities have limited product selection, and whatever is available is marked up considerably.

If you went to a boarding secondary school or university outside a major city, you’ll immediately understand this dynamic.

Students would travel back from Lagos with extra products to sell to classmates at a nice markup—toiletries, electronics, snacks, you name it—because those items were either unavailable or wildly overpriced locally. It was a whole informal economy. The things people in major cities take for granted are a luxury in smaller towns.

Jumia is that student, except it has 350 pickup stations and a fleet of delivery trucks.

It’s worth remembering that Copia, the well-funded Kenyan e-commerce startup, had identified a nearly identical opportunity before it went into administration in mid-2024 and eventually liquidated. Copia focused on serving mass-market consumers in rural and peri-urban areas through a network of 50,000 agents. The thesis was sound: underserved populations, limited assortment, and high local prices. It burned through over $120 million, and the economics never clicked.

The difference, presumably, is that Jumia already has the logistics network, the brand recognition, and the warehousing infrastructure across eight countries. It doesn’t need to build from scratch in each new region. It just needs to extend the last mile.

If Jumia’s moat is really about being the best (or only) decent option in underserved cities rather than beating Temu on price in Lagos, it means the growth story is tied to the physical reality of how goods move across Africa, not a competitive cycle that could reverse when the next Chinese app shows up. It also means Jumia’s flywheel gets stronger the further it pushes from the big cities, exactly where the competition is thinnest, and the margins are fattest.

This year, the company raised commissions across most countries without vendors kicking up a storm. When you can hike your take rate, and your sellers just keep selling, it’s usually a sign of genuine product-market fit.

Share

So, is this actually working?

“We believe that we are now in the right markets, at the right time, and finally with the right product-market fit.”

That’s a big statement from a company that has been promising profitability since roughly 2019.

It’s also a sentence that contains the word “finally,” which is doing a lot of heavy lifting. Jumia is targeting adjusted EBITDA breakeven and positive cash flow in Q4 2026, and full-year profitability in 2027. The company says its existing $77.8 million in liquidity is sufficient to get there without raising additional capital.

It’s a more credible claim than it’s ever been. But it’s still a claim. Advertising revenue, which Dufay envisions growing from 1% of GMV to 2% over the medium term, underperformed in 2025.

Dufay was candid about this on the call: “Monetisation on the advertising side is still lower than our expectations in Q4, including across the whole year, actually, and that’s the reason for deviation on the bottom line.”

The guided EBITDA loss for 2026 is still negative $25 million to $30 million, which means there’s very little room for error in the back half of the year. This is a company that needs everything to go right for the next seven quarters.

Still, the trajectory is unmistakable. Costs are structural and trending down. Revenue is growing at 34%. The China sourcing pipeline is scaling. Upcountry penetration is expanding. And the competitive landscape is, for the first time in years, moving in Jumia’s favour rather than against it.

If full-year profitability arrives in 2027, it would will have taken 15 years. That’s a long time. But for a company that was trying to build logistics infrastructure, payment systems, and consumer trust in some of the world’s hardest markets, maybe the surprise isn’t that it took this long. Maybe it’s that they’re still here at all.

See you on Sunday!

Liking and sharing the newsletter helps it travel!

Share

Sunday’s newsletter is powered by Credit Direct and Busha.

Manchester City just completed the double over Liverpool this season (you take what you can in a bad season). Happy Sunday to those who celebrate. If this newsletter was forwarded to you, subscribe here for free:

Subscribe now

TOGETHER WITH CREDIT DIRECT

When your money has direction, it works harder for you. Clear goals turn intentions into action and help you stay focused on what truly matters.

Start building toward what you want with a plan that rewards commitment andconsistency. Set your target, stay on track, and watch your goals move closer to reality.

Start Building With Yield

Sexy Steel

In the last couple of years, the term asset-light has firmly lodged itself into the world of business. Every company now prides itself on being efficient, which often just means owning as little non-essential stuff as possible.

In practice, it’s straightforward: sell the stuff that ties up your capital. Focus on your core competency. Don’t own the real estate; lease it. Don’t own the trucks; outsource the logistics. Don’t own the towers, rent them.

But this is the real world; when you’re confronted with new information and data, you do an about-turn.

All of that to say: MTN Group is reportedly in advanced talks to buy the remaining 75% of IHS Towers it doesn’t already own, in a deal that could value IHS at around $2.76 billion. (IHS has also confirmed the approach is non-binding and there’s no certainty that a transaction will happen.)

Twelve years ago, the point of the towerco model was that telcos shouldn’t own towers.

Why carry a lumpy, capital-heavy asset on your books when you can turn it into a long-term contract and let a specialist sweat the operations while you focus on the sexy parts of spectrum, customers, pricing wars, and, in Nigeria, the eternal sport of convincing the NCC to raise tariffs?

Before we get to the question of how we got here, it’s critical to know that if the deal happens, it will be a group-level acquisition of what is mostly a Nigerian business. FY2024 filings show that Nigeria accounted for 58.3% of IHS’s total revenue (down from 65% in 2023).

MTN Nigeria alone accounted for 46% of IHS revenue in 2024, while MTN South Africa accounted for 5% (with MTN Cameroon and MTN Côte d’Ivoire at 4% each, MTN Rwanda 2%, MTN Zambia 1%).

With that out of the way, let’s rewind.

The logic of outsourcing tower operations was always straightforward.

Cell towers are not about just putting steel in the ground; there’s diesel and power, security, maintenance, and the million and one things that can go wrong. In infrastructure, Murphy’s law is never far behind.

So the towercos pitch to telcos was: sell us your towers, and we’ll give you cash upfront. Also, instead of unpredictable capital expenditure, you get predictable operating expenses from lease payments.

The Towercos would take the operational burden and make the economics sing by stacking multiple tenants on the same tower. A tower has a high fixed cost; you’ve got to build, secure and power it. But once it exists, adding a second tenant adds revenue. Costs don’t double because another telco hangs equipment on the same steel.

I assume it wasn’t hard to convince Nigerian telcos to join what was broadly a global trend (only Globacom held out). MTN agreed to transfer up to 9,151 towers supporting its Nigerian network into a new company jointly owned with IHS, with IHS having operational control. Etisalat sold 2,136 towers to IHS in a sale-and-leaseback deal. Airtel agreed to sell 4,800 towers in Nigeria to American Tower in late 2014.

In the best of times, towercos work because they are boring businesses. They lock customers into long-term contracts, enjoy stable input costs, and diversify their tenancy.

In the last couple of years, none of those best-of-times assumptions have been true about Nigeria. Electricity prices have risen, inflation stubbornly skyrocketed, and FX volatility joined the party.

TOGETHER WITH BUSHA

Still waiting days for international settlements? Pay global partners in minutes with

Busha Business. Explore the smarter way to move money.

Explore Instant Settlement Options

MTN Nigeria renegotiated its tower lease agreements with IHS, extending master lease agreements to 2032 and adjusting terms to create what both parties called a more sustainable split between local and foreign currency. The revised terms substantially reduced the US dollar-indexed component, made leases majority naira-based, and removed certain technology-based pricing mechanics. Bye-bye boring contracts.

How about diversification? In IHS’s FY2024 annual report, its top three customers collectively accounted for 98.5% of consolidated revenue, with MTN Nigeria and Airtel Nigeria accounting for 46.0% and 11.4%, respectively. It can’t be easy to keep being a neutral landlord when one customer accounts for almost half of your revenue. When MTN Nigeria announced it was moving 2,500 sites to American Tower, IHS responded with legal action and public escalation.

In the ideal TowerCo story, the tower company is Switzerland. In the Nigerian story, the tower company sometimes looks like it’s part of the war, instead of renting land to the soldiers.

Say what you will, but towers have become too big to ignore, and that became doubly obvious in 2024.

In 2024, tower lease expenses (often dollar-indexed) had become nearly half of MTN Nigeria’s operating costs amid currency instability and inflation.

So maybe MTN Group is looking at its landlord and thinking: maybe we should be the landlord.

There’s also a small argument that telecom narratives get stale: subscribers up, data up, mobile money up, repeat. Owning the infrastructure stack is a different chapter, especially in markets where infrastructure can be unpredictable..

But there are problems that buying IHS doesn’t solve.

If MTN ends up owning IHS, the towers will still have diesel costs, security costs, maintenance costs, and IHS’s own financing and overhead to deal with.

Owning the towerco doesn’t magically eliminate the economic burden of running towers. There’s also the reality that towers make money by hosting multiple tenants.

If MTN becomes the majority owner, will Airtel and others be willing to rent from their rival?

See you next week!

Subscribe now

TOGETHER WITH CREDIT DIRECT

When your money has direction, it works harder for you. Clear goals turn intentions into action and help you stay focused on what truly matters.

Start building toward what you want with a plan that rewards commitment andconsistency. Set your target, stay on track, and watch your goals move closer to reality.

Start Building With Yield

Just Consequences

I like to think that if you were starting a fintech company in Nigeria fifteen years ago, it would have gone like this: have a product idea, then spend a minute or two squinting at the licence categories. If nothing fit neatly, you built anyway. You tested, you iterated, you grew until you became too successful to ignore.

It was the age of anarchy experimentation.

Back then, Nigeria didn’t offer a neat “digital bank” license. Instead, the industry grew within a patchwork of mobile money, switching, processing, PSSP, and payment solution licenses. This regulatory negative space was a feature, not a bug. Smaller players played fast and loose, onboarding millions with lighter KYC friction and avoiding the heavy compliance anchors that slowed down traditional banks.

But it is now 2026, and you cannot launch first and worry about regulations later because fintechs are no longer experiments.

Moniepoint reported processing 5.2 billion transactions worth ₦94 trillion in 2023. Paga says it processed ₦17 trillion across 169 million transactions in 2025. These are big companies and their velocity means there’s systemic risk in there.

At the 60th Annual Bankers’ Dinner on November 28, 2025, CBN Governor Olayemi Cardoso signaled that the era of “letting things slide” is officially over:

“By mid-2025, leading fintech apps had surpassed 10 million downloads each, with one surpassing 50 million downloads, reflecting deep consumer adoption.”

This scale necessitates a transition from a ‘wait-and-see’ approach to one of rigorous oversight, ensuring that these entities—which have become systemically important—operate with the same institutional gravity as traditional banks.

When Cardoso promised “more scrutiny,” many people assumed that meant a blizzard of fresh rules.

Instead, the message, made clearer in the CBN’s new policy paper, Shaping the Future of Fintech in Nigeria: Innovation, Inclusion and Integrity, is more pointed: we don’t need a new rulebook. We need to enforce the one we already have, and upgrade the infrastructure that makes enforcement possible at fintech scale.

Two takeaways matter (to me) most.

The first is that the CBN views payments as a problem that’s largely solved. If you live in urban Nigeria in 2026, you can buy pepper, akara, suya, or groceries assuming that someone, somewhere, will accept a transfer or shove a POS terminal in your direction. I haven’t carried a debit card in over a year. Most transactions are processed in under a second.

You wouldn’t exactly know this, given how some Nigerians fawn over Pix or any other country’s instant transfers. There’s rice at home, people of God.

Anyway, nothing is perfect, and peak periods still expose the seams: surges, timeouts, intermittent downtime, fraud spikes, dispute backlogs. So we need to shift from building capacity to maintaining trust through resilience, uptime standards, fraud controls, and consistent supervision.

But financial services transcend payments. Formal credit penetration is 6%, insurance is 3,% and pensions is 8%. Those are dreadful numbers.

Nigeria’s low transaction fees (call all the people who constantly complain about banking fees) make the “commercial viability” of pushing payments and credit into rural markets harder. Whatever happened to the Payment Service Banks and agent banks that were supposed to take payments and credits to the last mile?

PSBs can collect money and move money, but they cannot lend, so there’s one dead end. Agent banking, too, has stubbornly remained mostly a cash-in, cash-out business, largely because there’s weak demand for anything else.

These realities are forcing the CBN to consider a few structural shifts to fix its approach to inclusion. According to the report, the CBN is now coordinating a review of PSB lending restrictions, a sign that the ban on lending, the very thing that handicapped MoMo and others from the start, could be lifted.

To solve the cost problem of rural onboarding, the Bank is also collaborating with NIMC to provide affordable, developer-friendly NIN APIs, effectively turning identity verification into a low-cost utility. Most tellingly, the report hints at a move toward a dedicated Digital Bank authorisation framework, signaling that the CBN would rather empower new entrants with a full credit engine than continue to patch up the limited PSB mandate.

TOGETHER WITH BUSHA

Still waiting days for international settlements? Pay global partners in minutes with

Busha Business. Explore the smarter way to move money.

Explore Instant Settlement Options

What are Nigerian fintechs doing with AI?

My top answer would have been credit decisioning, but it came in a close second. The biggest use case for AI by far is fraud detection (87.5% of respondents), according to the CBN report.

Credit scoring, risk modelling, and onboarding/KYC sit much lower. Fraud has been the headline since 2024, so maybe no big surprises there.

The report talks up shared utilities—Compliance-as-a-Service, fraud intelligence hubs, supervisory technology (SupTech), and real-time alerts. It even references strengthening the Central Industry Fraud Desk (HAWK) hosted at NIBSS.

That’s it. See you on Sunday!

If this email was forwarded to you, subscribe here for free:

Subscribe now

TOGETHER WITH CREDIT DIRECT

When your money has direction, it works harder for you. Clear goals turn intentions into action and help you stay focused on what truly matters.

Start building toward what you want with a plan that rewards commitment and consistency. Set your target, stay on track, and watch your goals move closer to reality.

Start Building With Yield

What People Get Wrong About Nigeria’s Tech Media

There is a genre of writing that pops up every few months in tech: founders complaining about journalists, journalists complaining about founders, everyone insisting they are the only adult in the room, and then some venture capitalist tweeting “this is why we need more founder-led media” or whatever.

This genre is boring, but not because there is no tension between founders and journalists. There will always be tension between founders and journalists, just as there will always be tension between teenagers and their parents, or between people and the mirrors that show them what they look like in fluorescent lighting.

It is boring because it treats a permanent condition as if it were a scandal. “Oh no,” the founder says, “you described my decision as a ‘sale’ when I prefer to think of it as a ‘strategic alignment of shareholder outcomes.’ Anything for the clicks, I guess.”

And the journalist shoots back with a Substack post, “Oh no, the founder is trying to control the narrative.” And everyone is shocked. But that is what everyone is doing, all the time.

The more interesting question that deserves more words and Substack posts is, why is it so difficult to run a good Nigerian tech publication?

I don’t mean the usual problems. Yes, advertising revenues are in the gutter, social media platforms make overnight changes that destroy pageviews, and the readers who swear they love smart journalism are lowkey reading Instblog9ja. These are all real problems by the way. But they’re not the thing.

The thing in Nigeria is what I’m calling the Media Theory of Being Hampered by Context.

In an ideal version of journalism, “Can I provide context?” means: I think you got a fact wrong, and I would like to correct it.

Like, you wrote that the company raised $10 million, and it actually raised $12 million, or you wrote that the CEO joined in 2020, and she joined in 2019. Great. Fixed. Journalism works.

In Nigeria’s tech ecosystem, “can I provide context?” often means: the facts may be right, but can we renegotiate what they mean?

This is not necessarily sinister!

Business is complicated, people change their minds, and strategies evolve. Most things are not as simple as “good” and “bad.” And journalism is supposed to be fair, and fairness requires hearing from the other side, and the other side often has some reasonable explanation for why the thing you think looks odd is actually totally normal.

But the Nigerian twist is that in a small ecosystem, hearing from the other side can easily become a relationship event.

You are not just emailing a press office. You are calling someone you might see next week. You are asking a friend-of-a-friend to comment on a story about another friend-of-a-friend. You are doing it in a culture where sensitive things are handled with calls, not emails, and where the call is a part of a social ritual. The “why are you doing this?” and “do you really need to report this?” are the undercurrent of those conversations.

Nigeria’s tech ecosystem is an “everyone has everyone’s gist” industry. People know things. People share things. There’s just an unspoken gentleman’s agreement to treat the gist with care.

So journalists end up facing a strange question: why are you giving out this gist? Why are you taking something we all know privately and putting it on the record where it becomes real?

But nature abhors a vacuum. When journalists don’t publish what they know and when stories get softened into harmlessness, or killed entirely, the void gets filled by hot takes, long threads, and confident nonsense. Sometimes it’s the truth. Sometimes it’s fiction. Often it’s a cocktail of both.

Which is where context comes in. Context is the respectable, professional word for “let’s not make this awkward.” It’s how gist stays gist and also how reporting gets negotiated down from “here’s what happened” to “here’s what everyone can live with.”

TOGETHER WITH BUSHA

Doing business across Africa shouldn’t be complicated. Built on secure, compliant infrastructure, Busha helps businesses move money confidently, scale faster, and stay focused on growth.

Explore Busha Business

Last week, I listened to the Open Africa podcast, which I highly recommend, and it included some Nigerian tech journalism bashing. Some of it was fair, which is always a crowd-pleaser. At some point in the conversation, the hosts toyed with the idea of starting their own publication, which is also a permanent feature of the ecosystem. Everyone who knows a lot about tech thinks they could run a newsroom better.

Days after that episode, the founder of Mono pushed back on Twitter about how the podcast hosts characterised his decision to sell the company. He used the phrase founders always use when they want to sound like they have caught you doing bad journalism: “something something you did this for the clicks, I guess.”

You could tell, listening to the podcast, that the hosts were trying to be charitable. They were doing the normal journalistic thing of being careful, of giving space for nuance, of not sounding like they were trying to embarrass anyone. And yet the founder still felt mischaracterized.

This is a structural feature of technology journalism.

Founders are in the narrative business. They are raising money, hiring talent, selling to customers, negotiating with regulators, and maintaining morale. A characterization is an important intangible asset, so good luck convincing them that your framing is neutral. A founder will push back even when the story is not a hit piece, because they’re always managing mark-to-market values of reputation.

Journalists, on the other hand, are in the meaning business. They take facts and try to assemble them into something that helps readers understand what is happening. And “what is happening” is often not the founder’s preferred story.

So the founder asks for context. The journalist provides room for context. And the story is repriced. If you want to see the game clearly, throw money into the mix.

Imagine a startup has paid you a lot of money over the course of the year, and now you have to write a story that is critical of them.

Not an exposé. Not “the CEO committed fraud,” which is obviously newsworthy and, in theory, unavoidable. I mean something much more common and much more uncomfortable: a story that asks boring but obvious questions.

Like: why should anyone believe this pivot, when the last pivot was also presented as the final form? Or: how are you really defining profitability if I can’t see your books? Or: if this product is so transformative, why is adoption limited to the founder’s Twitter followers and three family members?

These are not questions about bad behavior. They are just the questions you would ask if you’re not hypnotized by access. (To be fair, access and relationships are scarce. Money is also scarce. That scarcity expresses itself through context.)

The company will not call you and say, “Do not publish.” That would be gauche.

Instead, they offer a conversation to provide context. It’s essentially what Nigerians do on sensitive matters: use the phone call to make sure the relationship is intact.

And because the market is thin and the publication is fragile and because you might need that relationship later, you may find yourself editing a sentence here and there. You fix temperature and tone. You remove a word that feels too sharp. You add a paragraph that frames the company’s story as still early. You include the explanation as if it resolves the question, when really it just explains why the company prefers you not ask.

And you tell yourself you are being fair. And maybe you are. But fairness, in this setting, has a directional bias of drifting toward the subject’s preferred framing.

This is why a lot of Nigerian tech coverage ends up being factually fine but essentially flat. By trying to manage the story and appease founders and relationships, you set the reading public on the wrong course.

So when journalists say “the ecosystem is mature enough for more criticality,” people often hear “we should report on more scandals.” Sure. But what the ecosystem actually needs is a less glamorous kind of criticality: the routine skepticism that doesn’t treat every product launch like a coronation.

Which brings me back to the people who want to start their own publications because they believe journalists are doing a bad job.

You might be right! You might be able to do it better. You might have more operational knowledge, more nuance, and better instincts about what matters.

But you will run into the same problem because it is not really a journalism skill issue. It is a market structure issue.

The question is less “can you write” and more can you publish common-sense skepticism about your friends, in a small ecosystem, in a thin market, when ‘context’ arrives as a phone call and the phone call is really a negotiation over meaning?

Because in Nigeria, context is something that tries to own your story.

That’s it. See you next week! Don’t forget to like, share, and leave a comment.

Leave a comment

TOGETHER WITH RAENEST

For Nigerians earning across borders, receiving money is often just the beginning. As payments grow larger or more frequent, fees tend to rise alongside them, creating uncertainty around costs and take-home amounts.

Raenest is built differently.

With Raenest, you get four free deposits every month, followed by a flat $1 deposit fee, no matter the amount, for ACH and stablecoin deposits. Whether you’re receiving $300 or $30,000, the cost stays the same. Conversion fees are also low at 0.5% and capped at $2.70, so they don’t scale endlessly as you convert more, and Raenest’s exchange rates are consistently among the best in the market. All of this makes Raenest pricing the best on the continent.

Raenest is designed to support how global income actually grows. Global earners across freelance platforms, international employers, clients, and anyone making cross-border transfers can receive USD, GBP, EUR, USDT, and USDC, convert, and withdraw to local bank accounts smoothly, without worrying that higher earnings will automatically mean higher fees.

Get Started With Raenest