Yello Digital Financial Services Limited (YDFS), a subsidiary of telecom company MTN Nigeria, has secured a licence to provide financial services in the country.

According to local media reports, YDFS secured a full Super Agent Licence from the Central Bank of Nigeria (CBN). It will enable YDFS to utilise its agent network and hire small businesses to distribute financial services across Nigeria.

The move follows Nigeria’s decision to open up the banking sector to telecom companies in a bid to improve financial inclusion in the country.

Subsequently, MTN Group, the parent company of MTN Nigeria, announced its plans to apply for mobile banking licence.

MTN Nigeria CEO Ferdi Moolman was quoted by Reuters as saying: “Through the network established by YDFS, MTN is in a position to broaden the availability of financial services for the under-served across the country.

“This marks a very important first step in leveraging our infrastructure to scale our Fintech initiatives.”

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The company has also applied for a payment service bank licence and expects it to receive soon.

MTN is said to have one of the largest mobile phone networks in Nigeria serving around 56 million people.

This year, Nigerian lenders Access Bank and Diamond Bank merged operations to form largest retail bank by customer numbers.

The merger, first announced in December last year, received regulatory approval in March 2019.