Frontier Fintech GPS #30 - April 30th 2025
Nigeria moves closer to Open Banking as CBN gives green light, OmniRetail raises US$20m to expand regionally, Alipay Tap reaches 100m users and other stories that matter.
Illustration by Mary Mogoi
Hi All, Welcome to the 30th edition of Frontier Fintech GPS where I provide key insights on the top global Fintech news items that matter to you. This newsletter will be arriving in your inboxes every Wednesday morning. The idea behind Frontier Fintech GPS is to help you navigate the endless stream of Fintech news and get smart about global Fintech as it applies to Africa. To those who are yet to subscribe, hit the subscribe button below and share with your colleagues and friends. 🚀
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🇳🇬 CBN Approves Open Banking Launch for August 2025
The Central Bank of Nigeria (CBN) has approved the launch of open banking, set to begin on August 1, 2025, following eight years of advocacy led by Open Banking Nigeria. This makes Nigeria the first African country with an open banking regulation, initially approved in 2023. The framework will enable secure data sharing between banks and third-party providers via APIs, fostering financial inclusion and innovation. The CBN will establish a registry by July 2025 to standardize protocols, ensuring security and interoperability. The initiative, backed by fintechs like Flutterwave and Paystack, aims to enhance credit access, competition, and tailored financial services, with a regulatory sandbox supporting innovation.
The results from UK’s open banking implementation are mixed, there has been barely any account switching as was expected or “increasing” new competition. Moreover, Open Banking Penetration stands at 14% meaning that only 14% of Brits have used Open Banking. If anything, what has happened is that new banks like Monzo, Sterling and Revolut have competed on their own merits. Nonetheless, this move by the CBN is interesting for a number of reasons;
It gives precedence for a major African economy with learnings that can be exported to the rest of the continent;
Traditionally, Nigerian banks have shied away from lending to consumers and SMEs. This data can be used to better score new clients for digital players like Fairmoney, Moniepoint and others - That being said, the practice of using APIs to access data is well established in Nigeria with players like Mono;
I don’t expect any major changes in the competitive dynamics in Nigeria’s Fintech market. Like UK, Nigerian Neobanks are growing and acquiring customers without the help of Open Banking. There’s scant evidence of any transformational benefits for Open Banking.
🇳🇬 OmniRetail Raises $20M to Expand B2B E-Commerce Across West Africa
OmniRetail, a Nigerian B2B e-commerce startup, secured $20 million in Series A funding to grow operations in Nigeria, Ghana, and Ivory Coast. Backed by Norfund, Timon Capital, and Ventures Platform, the company, founded in 2019, digitizes supply chains for over 150,000 informal retailers, processing over $800 million in transactions yearly. Profitable since 2024, OmniRetail aims to enhance its embedded finance offerings, like Omnipay BNPL, and scale logistics. The 2024 acquisition of Traction Apps strengthened its payment infrastructure for tailored financial products. This follows a $15 million pre-Series A in 2022, totaling $38 million raised.
OmniRetail is one of my favourite African tech companies. They have a nuanced understanding of African supply chains and their work and growth reflects this understanding. In terms of embedded finance, their BNPL product disburses US$ 12 million per month with barely any defaults. This is only possible because their clients see them as essential and not a nice to have. Long-term, their ability to aggregate credit demand from retailers should enable them to become a major marketplace platform for external financiers. As Norfund stated whilst commenting on this raise “OmniRetail’s model brings capital to areas where traditional systems haven’t reached.” The combination of technology and access enables OmniRetail to be able to distribute additional services such as wealth and savings. Long-term, a partnership of some sorts with Moniepoint may make sense given the alignment between their mission and executional capabilities.
Their expansion to Ivory Coast validates a recent analysis we did on non-big four markets that shows that Ivory Coast and Senegal should be top of the list for Nigerian Fintechs and Pan-African investors.
🇭🇰 Alipay Tap! Hits 100M Users, Eyes Global Expansion
Alipay Tap!, a QR code-based contactless payment solution, has surpassed 100 million users globally within 11 months of its June 2024 launch, with significant adoption in Hong Kong. The platform enables payments by tapping unlocked phones on merchant terminals or Alipay Tap! Tags, accepted at over 80% of local merchants, including major chains like 7-Eleven and Café de Coral. In Hong Kong, AlipayHK’s 4.2 million monthly active users dominate the mobile payment market, processing over HK$1.2 trillion annually. Enhanced by Alipay+ integration, it supports 14 global e-wallets, connecting 1.2 billion users. The 2024 Hong Kong Smart City Award underscores its role in advancing the city’s cashless ecosystem.
I recently had coffee with a friend who’s building in the B2B cross-border space, particularly the Kenya-China Corridor. One interesting insight which confirms some prior discussions I’ve had is that most merchants have Alipay accounts and use them for settling with their Chinese suppliers. What happens is that they have agents that enable them to top up their wallets and an ecosystem of sorts has already emerged. Interestingly, John Haule, founder of Swahilies posted something on LinkedIn also speaking of this trend amongst Tanzania merchants of having Alipay for settlements. Alipay and particularly Alipay+ is a long-term trend that should be getting as much if not more attention than the Stablecoin boom. I wrote about it here.
🇬🇧 Revolut Achieves First $1B Profit Amid Subscription and Wealth Unit Growth
Revolut, a London-based fintech, reported its first $1 billion annual profit in 2024, with group revenue rising 72% to $4 billion. The growth was driven by strong performance across card payments, foreign exchange, and a 298% revenue increase in its wealth unit to $647 million, fueled by crypto trading and its new crypto exchange. Subscription revenue grew 74% to $541 million, with 45% more users adopting premium plans. Business banking saw a 56% rise in active corporate users, contributing $592 million. With 52.5 million customers, Revolut plans to launch UK banking operations in 2025 and aims for 100 million daily users globally. Some key highlights;
Total revenue up 72% to GBP 3.1 billion;
Revenue was driven by;
Subscriptions revenue grew by 74% to GBP 423 million - Reflecting strong customer affinity;
Wealth revenues grew by 298% to GBP 506 million with their crypto business growing rapidly - an area that African banks should look to get into;
FX Revenue grew by 58% to GBP 422 million
Overall, non-funded income accounted for over two-thirds of total revenue;
Interestingly, of this total revenue figure, Rest of the World accounted for only GBP 55 million. I expect that in 5 years, their rest of the world revenue should exceed their European revenue;
Total retail customers grew by 38% to GBP 52.5 million - Interestingly, business accounts now account for 15% of revenues;
Total transaction volume stood at GBP 1 trillion;
Customer balances grew by 66% driven by the fact that there was a 59% growth in the number of customers who use Revolut as their primary bank
The intersection of world class digital transactional capabilities and AI will create a new breed of financial services players that in my view will eclipse incumbents over the next 20 years from a revenue and balance sheet perspective.
🇺🇸 Mastercard Introduces 'Agent Pay' for AI-Driven Transactions
Mastercard has launched 'Agent Pay,' a new payment solution designed to integrate with generative AI platforms, enabling AI agents to conduct transactions on behalf of users. The system utilizes 'Agentic Tokens' to securely authorize payments, building upon existing tokenization technologies used in mobile and online payments. Collaborations with companies like Microsoft and IBM aim to expand the application of this technology across various sectors, including consumer retail and B2B transactions. The initiative emphasizes user control, requiring explicit consent for AI-initiated purchases, and incorporates security measures such as biometric authentication to protect against fraud.
Imagine planning a wedding - in fact, imagine just giving your AI the task of planning your wedding, giving it a budget and sitting back to only approve what the AI recommends. Mastercard is building this reality. Mastercard has been very busy of late. It recently announced support for Stablecoins and is now moving into agentic payments. Agentic AI is making strides especially as global tech companies align around the use of Model Context Protocol (MCP) as the communication standard for AI agents. Naturally, if AI agents are doing more and more of your work then the next automatic step is to enable agentic payments where the agents make payments on your behalf. This is a new vector where new companies will emerge but its also an area that incumbent players like Visa, Mastercard, Stripe and Adyen need to be working on. Mastercard is right on the money with this move given that they can leverage their trust, relationships with banks and their vast network to supercharge Agentic payments.
🇬🇧 Unilever Expands eB2B Platform to Serve 1.5M Micro-Retailers
Unilever has upgraded its global e-commerce platform to strengthen both B2C and B2B operations, focusing on personalized buying experiences and operational efficiency. In 2024, e-commerce accounted for 20% of Unilever’s $65 billion in sales, with B2B channels growing 40% year-over-year. The company leverages AI-driven analytics to tailor product recommendations and streamline supply chains, particularly in high-growth markets like India and Southeast Asia. New B2B features include automated quoting and multi-tier account management, while B2C enhancements emphasize seamless omnichannel experiences. Unilever’s strategy includes expanding direct-to-consumer offerings and partnerships with digital marketplaces, building on a 65% B2B e-commerce growth in 2021 and consistent digital sales increases since 2018.
Unilever plays a big role in African supply chains and is often a major customer for banks in Kenya, Nigeria, Uganda, Zambia, South Africa, Ghana and others. Keeping tabs of the approach to distribution and sales is critical as they anchor a number of Supply-Chain Finance programs. In the long-term, Corporate Banking will continue its shift from a country-club game to an API game.
🇩🇪 Commerzbank Launches AI-Powered Avatar Assistant 'Ava’
Commerzbank has introduced Ava, an AI-driven virtual assistant and avatar, integrated into its mobile app to provide 24/7 support for private and small business customers. Built on Microsoft Azure, Ava uses generative AI and avatar technology, modeled on a real actress, to enable natural, conversational interactions. It handles tasks like ordering credit cards, adjusting limits, or blocking cards, with complex queries referred to human experts. Initially available in German, with English to follow, Ava adheres to strict security and AI regulatory standards. The rollout is gradual, with services expanding based on customer feedback, marking Commerzbank as a pioneer in combining generative AI and avatar technology for digital banking.
Conversational AI will be the native way of interacting with your bank, a point that was made by Kamal in an article we did last year. Moreover, in a podcast discussion with Ngozi Dozie, he rightly stated that this is the worst that AI will ever be. My advice to banks is to experiment and not worry about regulations, this technology is improving too fast and the implications are quite big. The penalty of being on the wrong side of regulation is way less than the penalty of being a laggard in an AI driven banking environment. Whilst implementing conversational AI, it’s critical that banks give their AI character as this will likely be a source of differentiation. A recent Time magazine article discussed how people are falling in love with their AIs, this should guide your thinking about CX and conversational AI, make your customers fall in love with your bank.
🇰🇪 Mobile Money Usage Rises in Kenya Amid Declining Transaction Values
Kenya’s mobile money transactions dropped 19.6% from KES 790.8 billion ($6.13 billion) to KES 636.2 billion ($4.93 billion) in the year to February 2025, the lowest in over a year, per Central Bank of Kenya (CBK) data. Despite this, mobile money usage expanded, with active agents increasing from 320,182 to 394,853 and subscriptions rising from 77.3 million to 84.6 million. Rising inflation (2.2% in March 2025) and living costs have reduced household spending, leading to smaller or less frequent transactions. Competition from banks and fintechs like Airtel Money, which gained market share, and a spread-out agent network splitting earnings, further pressure transaction values. M-PESA, dominant since 2007, faces challenges as users shift to cost-effective alternatives.
I think this just reflects a tough economy and is validated by the Kenya Revenue Authority consistently missing its revenue targets. I wouldn’t read into this as a structural decline or issue with M-Pesa. Nonetheless, in an austere period transaction charges become a point of differentiation with people looking to save money at every turn. This could mean a move towards cash, card payments despite their low uptake or even a shift to Airtel Money.
🇲🇽 Nubank Receives Preliminary Approval for Mexican Banking Licence
Nu Mexico, a subsidiary of Brazilian fintech Nubank, has received approval from Mexico’s National Banking and Securities Commission (CNBV) to transition from a Popular Financial Society (SOFIPO) to a full-service bank, becoming the first SOFIPO to achieve this. With over 10 million customers and $4.5 billion in deposits, Nu Mexico plans to expand its portfolio, introducing payroll accounts to boost financial inclusion, as only 36% of Mexican adults have such accounts. The company, which entered Mexico in 2019, has invested $1.4 billion to drive innovation. A regulatory audit is required before operations begin, ensuring a seamless experience for customers.
Nubank have been clear from day one that they want to go deep in a few markets rather than go wide in many markets. In Latam, they are going deep in Brazil, Colombia and Mexico and their goal is to be the primary bank for all their customers, particularly from a payroll perspective. Outside of Latam, it seems that they’ll invest in partners as opposed to going it alone given the recent investment in Tymebank.
🇯🇵 Japan and Cambodia Launch Cross-Border QR Payment System
The National Bank of Cambodia (NBC) and the Payments Japan Association (PJA) signed a Memorandum of Understanding to connect Cambodia’s KHQR and Japan’s JPQR payment systems. The initiative, rolling out in two phases, allows Cambodian Bakong users to pay in Japan by scanning JPQR codes in the first phase, with Japanese users able to use KHQR codes in Cambodia in the second phase. ACLEDA Bank and Sathapana Bank are Cambodia’s sponsoring banks, while NETSTARS operates payments in Japan. The collaboration aims to simplify digital payments for travelers, reduce currency exchange needs, and boost tourism, e-commerce, and small businesses. This builds on a 2023 agreement between NBC and Japan’s Ministry of Economy, Trade and Industry.
It’s important to pay close attention to the payments systems in Asia. There are two core trends that are emerging;
Central Banks connecting their Instant Payment Systems;
Alipay+ connecting merchant wallets across Asia with Thailand, Malaysia, Singapore, Korea and other major countries all being roped into the Alipay+ network
The long-term consequences are increasing trade and importantly, lower usage of SWIFT and the dollar correspondent system. Eventually, India will be roped into this and the economic heft of Asia will affect Africa given that Asia is our largest trading partner. I argue that payment systems follow trade and not the other way around.