Payment Service Banks in Nigeria: Opportunities and Challenges

Financial inclusion is essential to equitable and sustainable development. While some progress has been made in deepening financial inclusion in Nigeria over the past decade, the pace of inclusion has been slow due to significant demand- and supply-side challenges. At the end of 2020, only 51% of adults in Nigeria were using formal financial services, such as mobile money, insurance and pensions.

This report highlights the potential role payment service banks (PSBs) can play in expanding financial inclusion in Nigeria, and the opportunities and challenges for building commercially viable PSB operations. The report provides key lessons from the experiences of payments banks in India.