LAGOS, Nigeria — Nigeria’s Central Bank don fine fintech company Paystack ₦250 million ($190,000) for operating its new consumer product, Zap by Paystack. This app, wey be peer-to-peer money transfer platform, allegedly break regulatory rules. The CBN, wey get oversight responsibility, say Paystack no inform dem about the product before e launch for March 24, and e no get approval to run am.
According to source wey dey familiar with the matter, the fine na the largest public penalty wey Paystack don collect since dem get CBN approval for 2016. Paystack co-founder and CEO Shola Akinlade don talk about Zap say e focus on ‘fast, reliable and secure transfers’. But the app find itself embroiled in trademark issue with another startup, Zap Africa, wey dey accuse dem of infringement.
CBN say Zap dey function like deposit-taking product, something wey na strictly for banks, but Paystack na switching and processing company. The person wey get knowledge of the matter talk say dis limitation na wetin cause the sanction from CBN. ‘Paystack dey work closely with the regulator as dem dey review Zap, and we no go make any public comments now,’ one spokesperson from Paystack explain.
For Nigeria, e important make fintech companies adhere to the law, especially as many fintechs dey face increased scrutiny over compliance with onboarding and KYC (Know Your Customer) regulations. CBN don increase supervision in response to rising concerns about fraud and financial security within the sector.
The fine on Paystack show wetin dey happen as fintechs dey expand from B2B payments to consumer products. Other companies like Moniepoint and OPay don also face penalties up to ₦1 billion each around compliance issues. As Zap by Paystack dey fight to retain its name and scale operations, the company must first clarify its legality with the Central Bank.
