Reports emerging on Saturday have indicated that President Bola Ahmed Tinubu has reportedly directed the Federal Competition and Consumer Protection Commission (FCCPC) to dismantle South Africa’s grip on the airtime and data lending market in Nigeria.
It was gathered that the reported presidential directive targets Optasia (formerly known as Channel VAS), South Africa’s tech giant that has maintained a near-exclusive, 12-year grip on airtime credit and data advance services across major telecommunications networks in Nigeria, particularly MTN.
The regulatory intervention is poised to unlock an estimated ₦3 trillion in annual revenue, shifting economic power back to local players.
According to briefings from the FCCPC presented to the Presidency, Optasia’s decade-long dominance has fueled massive capital flight, with trillions of naira in profits systematically repatriated to South Africa while creating negligible administrative infrastructure or employment opportunities within Nigeria.
Pan-Atlantic Kompass reports that for over a decade, tens of millions of low-income Nigerians have relied daily on micro-sized airtime and data loans to stay connected.
However, this high-volume, highly profitable market segment has operated under restrictive exclusive agreements.
Industry data reveals that these services carry flat service fees of up to 15%, turning the credit advance space into an incredibly lucrative cash machine for foreign intermediaries.
Sources familiar with the development said the FCCPC convinced the Presidency that opening the market would align with the administration’s broader economic agenda of promoting local content, strengthening the digital economy, creating jobs, and retaining more value within the domestic financial system.
According to the commission, Optasia’s model had fuelled capital flight for over a decade, with the firm allegedly repatriating about N3 trillion annually in profits to South Africa while paying minimal tax locally.
Sources familiar with the development said the commission convinced the Presidency that opening up the market would promote competition, support the Nigeria First Technology Policy, create jobs for Nigerians, and curb capital flight.
The FCCPC reportedly raised concerns over the company’s operational structure, noting that despite its extensive activities in the country, it maintains a limited local presence and contributes little to Nigeria’s technology ecosystem.
FCCPC, which regulates consumer safety and competition in the country, maintained that deregulation would encourage competition and support the government’s Nigeria First technology policy.
The position of the commission is that opening the market will stimulate innovation, create opportunities for Nigerian firms, generate employment, and reduce the outflow of resources that have continued to leave the country under the existing arrangement.
“The Commission argues that deregulating the sector will promote competition, the Nigeria First Technology Policy, employment for Nigerians, and discourage capital flight to South Africa as hitherto perpetrated by Optasia,” according to a source within FCCPC discloderegulation drive is also in line with the administration’s broader objective of deepening indigenous participation in the fintech sector and reducing foreign exchange outflows linked to technology services.
However, Optasia had reportedly resisted the deregulation through legal and diplomatic channels. While its interim injunction to restrain FCCPC is already in court, sources confirmed the firm also deployed a diplomatic push, using a foreign President to reach out to Tinubu to preserve the deal.
But the diplomatic efforts had failed.
Before Optasia’s intervention, the FCCPC had briefed Tinubu on the economic impact of the monopoly.
The Presidency accepted the commission’s “economic-sense argument” that Nigerian fintechs have the capacity and technical know-how to provide the same services.
“To strengthen credit data infrastructure and promote competition, FCCPC forwarded a list of nine licensed Nigerian companies to the Presidency to upend Optasia’s grip, it further learnt.”
This development also comes as several Nigerians have been battling xenophobic attacks in South Africa.
It remains unclear if this latest development is related to the development in South Africa.
