A ₦62.56 billion Impairment on MTN’s fintech subsidiaries
Falling short of lofty plans despite an impressive 2025
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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.
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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!