MTN Group, Africa’s largest telecommunications operator, is seeking banking licenses that would let it lend money directly from its own balance sheet, marking its most aggressive push yet into financial services across the continent.
The move builds on comments from MTN Group Fintech CEO Serigne Dioum and Group CEO Ralph Mupita, who told investors the company wants to move beyond simply connecting customers to third-party lenders. If regulators sign off, MTN would begin issuing loans itself in select markets, including Nigeria.
“We’ve expanded access to credit for more people, but we also want to move further up the lending value chain,” Dioum said. “Where appropriate, we will seek licenses that allow us not only to facilitate loans but also to lend directly to customers and deploy our own balance sheet.”
A Cash-Rich Moment
The lending push comes as MTN reports its strongest half-year performance in years. For the six months ended June 30, 2026, service revenue climbed 17.5 percent in constant-currency terms to 115 billion rand, while core earnings rose almost a quarter to 56 billion rand. Adjusted headline earnings per share jumped 21.3 percent.
Ghana and Nigeria were central to that turnaround. MTN pulled in 13.9 billion rand in cash from its operating units in the first half, up from 8.2 billion rand a year earlier. Ghana alone contributed 6.6 billion rand — more than twice what Nigeria sent and well above the 2.1 billion rand generated by MTN’s home market, South Africa. Together, the two West African markets supplied roughly two-thirds of the cash flowing back to Johannesburg.
That strength gave the board room to approve a 6 billion rand ($375 million) share buyback covering about 31 million shares, part of a broader policy of returning 40 to 60 percent of free cash flow to shareholders. No interim dividend was declared, consistent with the first half of 2025.
Why Lending, Why Now
The rationale is straightforward: Africa’s credit market remains largely untapped. Dioum said only 4 to 5 percent of adults on the continent have access to formal credit. In Nigeria, roughly 80 percent of micro, small and medium enterprises lack access to formal financing, and the sector faces an estimated $236 billion funding gap, according to figures cited from Nigeria’s National Credit Guarantee Company and a Stears report.
MTN is entering that gap from a position most banks cannot match. Its mobile money platform, MoMo, had 70.8 million monthly active users in the first half of 2026 and processed 13 billion transactions worth $330.5 billion, up nearly 34 percent in constant currency. More than two million merchants already use the platform.
More than a million customers currently access loans through MTN’s existing partnerships with banks and third-party lenders each day — a distribution role the company now wants to convert into direct lending.
MTN estimates Africa’s fintech revenue pool could grow as much as 13-fold over the next five years. With more than 90 percent of transactions on the continent still cash-based, the company sees room in payments, remittances and lending alike.
Regulatory Hurdles Remain
The path to direct lending runs through regulators, and Mupita declined to specify which licenses MTN is pursuing in which countries. In Nigeria, MTN’s fintech subsidiary, MoMo PSB, applied in November 2024 for Payment Solution Service Provider and Payment Terminal Service Provider licenses; that approval process is still pending.
The company is also working to upgrade its existing banking license in Nigeria to add lending, international remittances and a broader range of payment services.
Nigeria’s push is tangled up with a larger corporate restructuring. Shareholders approved shifting majority control of MTN Nigeria’s fintech subsidiaries to MTN Group Fintech B.V. in April, a transaction still under review by the Central Bank of Nigeria.
Ghana completed a similar separation of its fintech unit on March 31, becoming the first market to finalize the structure — a milestone that may explain why Ghana’s cash contribution to the group has grown so sharply.
The Competitive Stakes
Moving from facilitator to direct lender would raise MTN’s revenue potential, but it also exposes the company to credit risk and regulatory scrutiny that banks have long managed — and that MTN has largely avoided by working through partners. It would also put MTN in more direct competition with fintech rivals such as OPay and PalmPay, which built their footholds partly because MoMo’s existing Nigerian license excluded lending and other services.
What remains unclear is the timeline. MTN has not disclosed which specific licenses it is targeting in which countries, nor when approvals might come through. For a company whose fintech arm has become one of its fastest-growing divisions, the answer will shape how much of Africa’s credit gap it can claim before rivals do.
Source: Reuters
