Nigeria Fintechs’ Adoption of 1% Transaction Fee and its Customers’ Woes

Fintechs services have made their impact known in the financial space in Nigeria, and while a majority of them did so –gaining so much recognition– based-off profit-making, it may just be about time for them to deploy the main strategy into the market, and of course, comes at a very high cost for the respective customers

Lately, some of the major stakeholders in the fin-tech space are beginning to adopt a new policy in the area of the transaction fee paid by users of the respective platforms. A 1% transaction fee has now been introduced on financial platforms including Carbon, and Opay– two of the most recognized fin-tech services in Nigeria.

Back in August, Carbon- a Nigeria foremost fintech became the first to introduce the 1% transaction fee, and it did so only on transactions made from regular banks to the wallet. However, as for the second adopter of the policy- Opay which followed suit a few days ago– effected the charges on payment made from wallet to regular banks in its own case.

While both fintech appears to embrace a different approach to the adoption of the new initiative, it almost doesn’t make any difference, considering that customers will mostly have to transact via either routine. Of course, Nigerians who engage in both services were filled with grieve having heard about the new policy and have vented their displeasure on various social media platform including Twitter and Instagram which hosted a majority of the conversation.

Many people’s grief is not because of the introduction of payment charges on the platform, considering that the service used to be free on Carbon, while Opay only charges ₦10 in its own case. Now, people have to pay a sum that is not fixed all in the name of transaction fee.

well, there is a clause to that– a positive one if you would see it that way; Opay says the 1% charges will not be effective on the first transaction made in a day, however, it will be charged on consecutive transactions. For instance, if an OPay user wants to send N100,000 from the app to a regular bank, instead of paying N10 as the transaction fee, the user will now pay N1000 (1%) as a processing fee or ₦45 for the first transaction for the day.

Other than the ridiculous charges that are now imposed on its customers– if compared to the traditional bank that only charges ₦52 for transaction fee between different banks, the new fee introduced by the respective fintechs is quite odd and appalling, especially for many Nigerians who now believe so much in the new economic system.

Also, while the current situation is still bearable for Carbon customers, the situation is far from better for Opay customers. The Opera-back fintech recently introduced a treasury bill-kind of service where it pays out 10% interest on every ₦10, 000 saved, or a variable of that depending on how much you are investing. Now, while a lot of people have invested in the new service, it ‘may all end in tears’ for many who may sooner or later find out that a lot of money will be forfeited, when trying to make a withdrawal of their money.

Certainly, this is not the best approach for the fintechs services, and while the policy may soon be adopted by other financial services, it may end up in another ‘exodus’ tale for them all if care is not taken.

 

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