MTN has received confirmation letter from the Central Bank of Nigeria (CBN) to function as Momo Payment Service Bank Limited (Momo PSB).
This was revealed in a press release issued by Uro Ukpanah, the Company Secretary, captioned “THE CENTRAL BANK OF NIGERIA GRANTS FINAL APPROVAL FOR MOMO PAYMENT SERVICE BANK LIMITED TO COMMENCE OPERATIONS.”
MTN Nigeria and Airtel Africa, two of Nigeria’s largest telecommunications firms, got “Approval in Principle” (AIP) from the Central Bank of Nigeria to function as Payment Service Banks in November 2021.
“MTN Nigeria Communications PIc (MN Nigeria) confirms the receipt of a recent letter April 8, 2022 from the CBN directed to Momo PSB expressing final authorisation to commence operations,” according to MTN’s announcement.
“The date of beginning will be informed to the CBN in accordance with its regulations,” MTN said, without specifying when operations will begin.
“MTN Nigeria underlines its dedication to the CBN’s and the Federal Republic of Nigeria’s financial inclusion agendas, and we are thrilled at this opportunity to assist in their implementation,” it added.
About the PSB license
The primary goal of giving PSB licenses, according to the apex bank standards, is to increase financial inclusion, particularly in rural regions, and to make transactions easier.
PSBs are expected to operate in rural areas and in locations where Nigerians lack access to banking services. In rural areas, they are also mandated to provide at least 50% physical points of entry (sometimes known as kiosks).
In several of their locations, PSBs may also have ATMs. Customers can withdraw cash as a result of this. A PSB and a traditional commercial bank share the ability to take customer deposits and invest a percentage of those amounts in short-term CBN or FG assets.
The key difference is that commercial bank banks are allowed to provide credit facilities, whereas PSBs are not.
They can also move some of their excess funds to any commercial bank they want.
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