Interswitch to offer telecom services in Nigeria after securing licence from NCC

March 12, 2024
2 min read
Interswitch building
  • Interswitch is set to enter Nigeria's telecommunications sector after acquiring a Tier 5 MVNO (Mobile Virtual Network Operators) licence for ₦500 million ($1.08 million) from the Nigeria Communications Commission (NCC) in May 2023.
  • The fintech obtained the licence through its subsidiary, Systegra Technologies Limited, a value-added service aggregation provider licenced by the NCC. It offers several services, including SMS and USSD gateways, IVR portals, web and WAP, gaming, carrier billing, mobile advertising, and consulting. 
  • This development means that Interswitch can provide affordable 4G or 5G services to Nigerians or extend telecommunication services to rural areas.

The fintech company will have to leverage the infrastructure of any of Nigeria's four telecommunications companies and deliver telecom services with minimal infrastructure in underserved regions.

Interswitch, which reported $42 million in revenue for its financial year that ended March 31, disclosed that it is “investigating the launch of a low level of capital expenditure virtual telecoms model using the licence, combining payments and telecoms services to B2B customers and consumers.” 

In 2023, the telecom regulator began the issuance of Licences to Mobile Virtual Network Operators to bridge the gap between unserved and underserved areas and populations.

MVNO is a telecommunications service provider that uses the infrastructure and capacity of a fully licenced mobile network operator to deliver its products and services.

This implies that although licenced companies offer services similar to those of MTN, Airtel, Glo, and 9 Mobile, they do not possess any infrastructure of their own. Instead, they leverage the infrastructure of existing Mobile Network Operators (MNOs) such as MTN, Airtel, Glo and 9 Mobile. 

As of June 2023, the Commission had granted licences to 25 firms, aligning with the objectives of the Nigeria National Broadband Plan (NNBP 2020-2025). Per the watchdog, this initiative aims to lead the industry towards achieving a 90% broadband penetration rate by 2025, surpassing 50% by the conclusion of last year.

According to an NCC report from January 2024, following an adjustment in the country's population figures by Nigeria's population commission, broadband penetration dipped from 45.47% to 40.85%. 

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