A decade ago, Nigerian fintech startups set out with an ambitious goal to disrupt the country’s financial services industry. At the time, digital payments were unreliable, financial services were slow, and access was largely limited to urban centres. Consequently, millions of Nigerians remained excluded from formal banking.
Tapping into the Central Bank of Nigeria’s financial inclusion mandate, these startups positioned themselves as challengers to traditional banks. Their mission was simple but far-reaching: bank the unbanked. Their strategy, however, was anything but broad.
Rather than replicate the full-service model of legacy banks, early fintechs chose to specialise. Each startup picked a single core offering — payments, cards, and lending — and built deep capabilities around it. This approach, often described as unbundling, allowed them to compete with banks without needing the same scale, infrastructure, or operational complexity.
It was, in many ways, a necessity. Without the decades of experience and institutional capacity that banks had built, going head-to-head across multiple services would have been a suicide mission. By isolating specific services and executing them more effectively and faster, fintechs could carve out niches and gradually earn customer trust.
That singular focus also enabled speed. Instead of spreading resources thin across multiple products, startups could concentrate talent, capital, and engineering effort on doing one thing exceptionally well. The result was rapid user acquisition and, in some cases, market dominance within specific verticals.
But that era is ending.
Today, many of Nigeria’s leading fintechs — Moniepoint, Sycamore, FairMoney, and, more recently, Paystack — are increasingly looking like the banks they once sought to disrupt. Their product suites now span payments, savings, credit, and even business banking tools. In other words, the industry is rebundling.
Rebundling financial services
For Nosakhare Oyegun, Vice President of Product and Innovation at Kuda, this shift is less a pivot and more an execution of a long-term strategy for some fintechs.
“For a lot of people this was always the plan,” he notes.
Victoria Fakiya – Senior Writer
Techpoint Digest
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From this perspective, the unbundling phase was simply a way to gain a foothold in a competitive and regulated market. Once that foothold was secured, expansion into adjacent services became the logical next step.
Oyegun categorises these expansions into two broad types. The first includes startups following a natural product evolution, building out features that align with their original roadmap. The second involves more opportunistic expansions, adding services that may not have been planned initially, but in response to customers’ needs.
Both pathways, however, lead to the same destination. Some fintechs, such as Kuda and Carbon, made their ambitions clear from the outset, positioning themselves as digital banks rather than niche service providers. For them, rebundling is less a strategic shift and more a continuation. But for others, the move has been more reactive.
For Ifunanya Chiegboka, Chief Commercial Officer at Fintech Nucleus, and Ifeyinwa Jide-Ebeogu, founder of The PaymentLogue, the push toward rebundling reflects a growing realisation across the industry that transaction fees alone are not enough to sustain most businesses.
As competition intensified and margins tightened, fintechs were forced to rethink their revenue models. Expanding product offerings and acquiring the licences required to support them became a way to unlock new income streams.
Babatunde Akin-Moses, co-founder and CEO of Sycamore, points to a structural limitation within the Nigerian market.
“The market is not deep enough purchasing power-wise for you to stay specialised for too long in such a way that it meets your goal,” he notes.
In other words, the addressable market for any single financial product is often too shallow to support long-term growth at scale. Specialisation, while effective in the early stages, can quickly become a ceiling.
Capital constraints further complicate the picture. According to Akin-Moses, there is a shortage of patient capital that allows startups to remain focused on a single vertical long enough to fully mature it. In its absence, founders are often pushed toward quicker monetisation strategies, which broader product offerings can provide.
Customer behaviour also plays a decisive role. Jide-Ebeogu argues that users are less interested in how well a company performs a single function and more concerned with perceived success and convenience.
“Consumers don’t really care how deep you’re doing something. They just care about what looks like the signals of success, and if you don’t have it, they’ll run away from you.”
This shift in expectations has been amplified by increased competition. In the early days of Nigerian fintech, startups had the luxury of time to build and refine their offerings. Today, the influx of capital and new entrants has eroded that advantage.
Anthony Isichei, General Manager at Paga, adds that organisational maturity has also played a key role in fintechs expanding their service offerings.
“Naturally, as an organisation matures, you begin to see other problems that you have solved for yourself internally, and you can take that and wrap it up as a service.”
While business realities are the primary driver of rebundling, according to these experts, regulation has also played a role, albeit a more nuanced one.
Jide-Ebeogu highlights the impact of licence fragmentation within Nigeria’s financial system. Different financial services require different licences, and acquiring these licences often opens the door to new opportunities. As startups secure additional regulatory approvals, the incentive to expand into adjacent areas grows stronger.
The result is a gradual blurring of boundaries between fintech categories. Payment companies offer loans; lending platforms introduce savings products; and digital banks build merchant tools.
The risk of rebundling
Despite this trend, the idea of a highly specialised fintech is not entirely obsolete. Both Oyegun and Akin-Moses acknowledge that it is still possible to build a single-product company in Nigeria. The challenge lies in growth.
“You can survive; you won’t die. You’ll just become stagnant,” Oyegun notes.
This distinction is crucial. A specialised fintech may achieve profitability and maintain a loyal user base, but its ability to scale, particularly in a competitive and capital-intensive environment, is limited.
Yet, the shift toward rebundling is not without its dangers. The most immediate risk is loss of focus. Expanding into new product lines requires significant investment, both financial and human. If not carefully managed, this can dilute attention from a startup’s core offering, potentially weakening the very foundation on which it was built.
Execution risk is equally significant. A company that excels in one area may struggle to replicate that success across multiple domains. Building new products introduces complexity, which can slow down decision-making and product delivery.
In some cases, the problem is not just expansion but timing. Oyegun points to the danger of premature scaling. Knowing when to expand is just as important as deciding whether to expand at all. Startups that move too early, before establishing repeatable processes or consistent product development cycles, risk overextending themselves.
This is particularly true in organisations where decision-making remains centralised. If critical product decisions depend heavily on a founder or CEO, scaling across multiple services can create bottlenecks and strain internal systems, as what worked for a single product may not translate to a multi-product operation.
Long-term financial commitments add another layer of risk. Jide-Ebeogu highlights the burden of multi-year technology contracts, such as core banking infrastructure agreements.
“There’s a risk that you’re investing in something that may never work out,” she notes.
These commitments can lock startups into costly obligations, even if the associated product fails to gain traction.
Can specialisation still work?
Despite the industry’s clear shift toward rebundling, there is broad agreement among operators that, for new entrants, starting with a single product remains the most effective strategy.
“I think every startup should not try and do everything at the same time. Pick one class of service and double down on beating the benchmark,” Isichei advises.
Focusing on one core offering allows startups to develop deep expertise, refine execution, and build operational discipline, capabilities that can later be extended into adjacent services. In this sense, unbundling is not a dead strategy but an essential first phase.
Even as the market matures, the logic that defined the early days of Nigerian fintech still holds: depth, before breadth, remains the more reliable path.
At the same time, significant opportunities remain untapped. Akin-Moses notes that while payments, lending, and neobanking have seen intense activity, other segments of financial services have been relatively underexplored.
Pensions, mortgages, and insurance, in particular, are areas where the application of technology is still limited. For new entrants willing to navigate regulatory complexity and long product cycles, these sectors offer room for differentiation.
The implication is that while today’s leading fintechs are expanding into full-service platforms, the next wave of innovation may come from startups that once again choose to go narrow — at least in the beginning.
