Nigerian fintech startup ‘TeamApt’, who recently secured a $5.5 million funding has also secured a switching license from the Central Bank of Nigeria. The startup will leverage on the license to switch money between banks by debiting them upon customer request. This license will power ‘AptPay’, one of TeamApts products. This announcement was made on the company’s social media page.
Switch-licensed companies can offer their clients electronic funds transfer, transaction switching and processing services. For instance, if a customer buys product online, the payment gateway provider pays the merchant instantly. However, without the switch license— the payment provider will cater for the payment with their own money. This could be challenging if the provider’s fund is below the purchase amount. However with a switching license– it will be easy to directly debit the customer’s bank and transfer the money to the merchant’s account instantly. No deposits required for the transaction.
CEO, Tosin Eniolorunda said “It is the highest license awarded to any fintech by the CBN because it allows you to put all the banks together and be able to debit their banking position with the Central Bank. What this translates to is that with AptPay, TeamApt can actually move money across the banks without putting money down.”
This license is essential for TeamApt’s new product, AptPay. AptPay is a payment infrastructure that processes payment, powers interbank transfers, and direct debits. This license will place TeamApt on the same level as other Tier-1 financial technology companies and other private switching companies like Interswitch, eTranzact, 3Line and Unfied Payments (UPSL).
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