SmartCash Payment Service Bank, the financial services arm of Airtel Nigeria, has reached nearly 3 million active users as it intensifies efforts to expand its digital banking footprint with a zero-fee model and a 15% annual interest rate on savings deposits.
The company said the figure represents customers who have transacted within the last 30 days, a stricter definition of “active users” than the six-month benchmark commonly used by many banks. Internal data suggests activity levels over 60- and 90-day periods are significantly higher, indicating increasing engagement nationwide.
PSBs Struggle for Scale
Since the Central Bank of Nigeria introduced Payment Service Banks (PSBs) in 2018 to expand financial inclusion, telecom-led fintech services have struggled to translate their large subscriber bases into financial dominance.
SmartCash generated about $6 million in revenue in Nigeria by December 2025 — a relatively small figure compared with fintech leaders such as OPay and PalmPay, which dominate the mobile money ecosystem. PalmPay alone reported $63.9 million in revenue in 2023.
Meanwhile, Nigeria’s mobile money sector continues to expand rapidly. According to the Nigeria Inter-Bank Settlement System, transactions reached ₦20.71 trillion ($13.49 billion) in the first quarter of 2025.
However, PSBs still face regulatory limitations: they cannot lend, operate under stricter capital rules, and entered the market later than independent fintech platforms.
Zero-Charge Banking Strategy
To close the gap, SmartCash is transitioning from temporary incentives to a permanent “Zero-Charges” strategy to attract deposits and increase wallet usage.
Under the model:
- Interbank transfers cost ₦0
- Bill payments carry no convenience fee
- SMS transaction alerts are free
These services typically cost customers ₦10–₦50 per transfer at traditional banks, excluding VAT.
The only remaining charge is government-mandated stamp duty on transfers above ₦10,000.
SmartCash CEO Ayotunde Kuponiyi said the policy is designed to remove what he described as a “psychological tax” discouraging low-income Nigerians from using digital financial services.
“Transaction costs act as barriers to people accessing financial services. We are eliminating this barrier — come and transact,” Kuponiyi said.
15% Interest and Cashback Incentives
In addition to zero transaction fees, SmartCash offers up to 10% cashback on airtime and data purchases through its mobile app or USSD code *939#.
The company also pays 15% annual interest on balances in its savings wallet — significantly higher than typical savings account rates in Nigeria.
Unlike many banks that limit withdrawals to maintain interest eligibility, SmartCash says interest is:
- Calculated daily
- Credited daily
- Automatically compounded
Kuponiyi noted that the rate depends on Nigeria’s broader monetary environment.
“It is subject to the Monetary Policy Rate (MPR). If the MPR changes significantly, it doesn’t make sense to keep paying 15%,” he said.
Infrastructure Advantage
SmartCash says its operations benefit from Airtel’s telecommunications infrastructure, which spans Nigeria’s 774 local government areas.
The service is supported by over 500,000 agents nationwide, enabling cash-in and cash-out transactions even in underserved communities.
To address failed transfers — a common issue in Nigeria’s digital banking system — the company says it operates an auto-reversal mechanism that returns funds to customers’ wallets within 24 hours, in line with CBN regulations.
Long-Term Strategy
Kuponiyi said the zero-fee model is not a temporary promotional tactic but a long-term strategy aimed at building a broader financial ecosystem.
Over time, the platform aims to expand into services such as credit, insurance, and remittances, leveraging its growing deposit base and transaction activity to compete more aggressively in Nigeria’s fintech sector.
