The move is aimed at deepening financial inclusion in Nigeria.
Telecommunication companies MTN and Airtel have been granted Payment Service Bank (PSB) licenses by the Central Bank of Nigeria (CBN).
This essentially means Nigeria's foremost telcos, who have dominated the mobile telephony market in Africa's most populous country since the early 2000s, could now give traditional banks in the country a run for their money.
"I am very pleased that Smartcash has been granted an approval in principle to operate a service bank business in Nigeria. We will now work closely with the Central Bank to meet all its conditions to receive the operating license and commence operations," says Segun Ogunsanya, CEO of Airtel Africa.
Financial analysts say the PSB licenses could deepen financial inclusion and revolutionize the mobile money market in Africa's largest economy.
MTN and Airtel have more than 70 million subscribers between them.
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