Nigeria Fintech Paylater Gets Credit Rating Ahead CBN Regs

Must Read

- Advertisement -

Fintech companies in Africa are increasingly playing in spaces dominated by traditional financial institutions. One Finance, parent company of Nigerian lending platform Paylater, has secured a credit rating.

Global Credit Rating, a leading credit ratings agency in Africa assigned One Finance a “BB” score, following a “rigorous” and “testing” process.

It’s the latest step as African fintech companies go mainstream, winning customers and investor conviction along the way.

Indeed, payment startups facilitating online transactions in key African economies are increasingly getting validation with global payment giants including Mastercard, Stripe and Visa paying closer attention and investing in Nigerian fintech companies.

- Advertisement -

Being assigned a credit rating means One Finance will be “held to the same levels of transparency and scrutiny as other leading financial institutions in Nigeria,” says Chijioke Dozie, chief executive of One Finance.

It also potentially allows the company to access latent sources of local capital from institutional investors, such as pension funds.

“We want to look at pockets of funding in Nigeria and it’s easier if you have a credit rating,” Dozie tells Quartz.

Access to finance is crucial for Paylater, One Finance’s lending app.

Read Also:  DBN Disburses N31 Billion To Small Businesses
- Advertisement -

Two years after it was founded the company says it now approves over 1,500 loans a day—with an average value of $80 per loan.

The credit rating approval has more significance given recent moves by Nigeria’s central bank (CBN) which is mulling new regulation would likely make it more expensive for fintech companies to obtain licenses with minimum shareholder fund requirements ranging from $275,000 to $14 million.

Given the apex bank’s increasing regulatory focus on fintech companies, Dozie says being “fortified” and “seen as strong” is necessary.

But even though much of the tech industry has railed against the central bank’s pricey license regime, Dozie suggests increased regulation is not necessarily a bad thing as fintech companies become more significant in the financial sector.

- Advertisement -

“CBN improving regulation doesn’t mean you can’t innovate,” he said. “Yes, it might stifle innovation but we also have to watch out for the protection of the customers.”

Read Also:  Naira drops to 390/dollar, CBN sells fresh $246m

Source: Quartz Africa

- Advertisement -

Subscribe to BrandSpur Ng

Subscribe for latest updates. Signup to best of brands and business news, informed analysis and opinions among others that can propel you, your business or brand to greater heights.

- Advertisement -


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest News

- Advertisement -

Latest News

NIPC’s CEO Wants Nigerians to Market Country As Investment Destination

The Executive Secretary/CEO of Nigerian Investment Promotion Commission (NIPC) Yewande Sadiku has enjoined Nigerians to join in the investment...
- Advertisement -
BrandsPur Weekly Cartoons
- Advertisement -spot_imgspot_img