It might look quite minor, like borrowing airtime now and paying later with an interest of 15 percent. But this seemingly minor service, plus and few other value-added services raked in N70 billion naira for MTN Nigeria Plc, a top telecommunication company in Nigeria.
Apart from airtime lending, other Value-added Services ( VAS) that raked in the billions include and mobile money (Fintech), subscriber identification module (SIM) backup services, and voice-based services. This earning is beside the billions made from mainstream services by the top telecoms brand.
The company recorded an increase of 51.91% in this revenue line from N46 billion in 2020, showing that subscribers during the period increased significantly. According to the company’s earnings release, active fintech subscribers rose by 4.8 million to 9.4 million, reflecting a 95.83% growth in subscribers during the period.
In addition to this, despite the decline in mobile subscription base, driven by regulatory restrictions on new SIM sales and activations mainly in Q1 through Q3 2021, MTN returned to positive growth in Q4 as mobile subscribers increased by approximately 1 million during the period.
Karl Toriola, MTN Nigeria CEO, commenting on the company’s segment performance, said, “Operationally, our mobile subscriber base declined by 10.6% and was impacted by the regulatory restrictions on new SIM sales and activations. However, we are pleased to have returned to positive growth in Q4 2021, adding approximately 1 million subscribers as we continued to ramp up the alignment of our SIM registration and activation centres with the regulations”.
He added, “Our fintech business continued to gain traction with approximately 770k registered mobile money (MoMo) agents and active users more than doubling to 9.4 million. This provides a solid foundation on which to launch the MoMo Payment Service Bank (PSB), for which we have received approval in Principle. The MoMo PSB will provide a powerful platform to drive digital and financial inclusion in Nigeria”.
MTN Nig Plc reported 22.90% growth in revenue for 2021 Audited Financial Statement. The revenue appreciated from N1.35 trillion to N1.65 trillion in the current period. Similarly, net profit for the period grew by 45.5% to N298.65 billion from N205.21 billion in the corresponding period of 2020.
A close look at the company’s notes to account reveals that the company generates the bulk of its revenue from voice calls and data subscriptions.