Manny Ita –
Smartcash Payment Service Bank is positioning itself to gain greater influence in Nigeria’s rapidly expanding fintech sector by introducing zero-fee transfers and a savings product offering up to 15 percent annual interest compounded daily.
Transaction fees, transfer charges and savings rates have increasingly become key competitive factors among digital banking platforms seeking to attract and retain customers in the country. Against this backdrop, Smartcash is attempting to distinguish itself by eliminating transfer charges while offering relatively high returns on savings.
The move represents a departure from the conventional fintech revenue structure, where fees from transfers typically cover infrastructure costs, switching charges, regulatory compliance obligations and fraud prevention systems. By removing these charges, the company is expected to absorb such costs internally or generate revenue through alternative services, challenging the traditional “fee-per-transaction” model widely used in the industry.
Smartcash’s strategy is also supported by its relationship with Airtel Nigeria, one of the country’s largest telecommunications operators. As a subsidiary of the telecom company, the platform benefits from access to extensive telecommunications infrastructure, including network towers, SIM distribution channels and an existing agent network that reaches both urban and rural communities.
Industry observers note that this “telecom-plus-fintech” model could provide the company with a scale advantage compared with independent startups that must develop their operational infrastructure from the ground up.
With an estimated three million active wallets, Smartcash is also positioned to spread operational costs across a large user base. In telecommunications economics, the marginal cost per user tends to decline as the network expands, and the company appears to be applying the same principle to digital financial services.
Alongside free transfers, the company’s savings product offering a 15 percent annual return is aimed at encouraging users to retain funds on the platform. In a market where traditional savings accounts often offer comparatively lower returns, the higher yield is intended to encourage customer “stickiness” by making users less likely to move their funds to competing platforms.
Customer loyalty in Nigeria’s digital banking ecosystem remains fluid, with users often switching services quickly in response to service disruptions or fee increases. Smartcash’s pricing strategy focuses on two areas widely regarded as sensitive to Nigerian consumers: the cost of transferring money and the loss of purchasing power caused by inflation.
Although other fintech companies have previously used “free transfers” as temporary promotional offers, Smartcash appears to be moving toward institutionalising the model as part of its long-term business approach.
The initiative also aligns with broader financial inclusion goals within the country. A significant portion of Nigeria’s population remains outside the formal banking system, particularly in rural areas where traditional banks have limited physical presence.
The introduction of the Payment Service Bank licence by the Central Bank of Nigeria allows non-bank entities, particularly telecommunications companies, to provide basic financial services aimed at bridging this gap. Through its mobile-based wallet system, Smartcash enables users in remote communities to open digital accounts, store money and conduct transactions without visiting a physical bank branch.
Analysts suggest that reducing transaction costs while expanding digital access could accelerate the adoption of electronic financial services across underserved regions.
If successful, the model could reshape expectations within the fintech industry across West Africa by promoting a framework where basic banking services operate as low-cost utilities, while providers generate revenue from additional financial products and value-added services.
