The Central Bank of Nigeria (CBN) has fined Paystack N250 million (about $190,000) over its peer-to-peer payments app Zap, TechCabal reported on 30 April 2025, citing a person with direct knowledge of the matter. The penalty relates to Zap operating as a wallet even though Paystack holds only a switching and processing licence.
A switching and processing licence permits a company to route financial transactions between banks and other institutions, but not to hold customer funds. The CBN flagged Zap as a deposit-taking product, a function reserved exclusively for institutions with microfinance or banking licences.
LICENSING RULES AND THEIR ENFORCEMENT
Zap, which Paystack launched in March 2025, allows users to send and receive money and is positioned as a consumer-facing digital wallet. The app does not store user funds directly, but operates in partnership with Titan Trust Bank, which is licensed to hold deposits.
The fine follows other regulatory actions on the boundaries of fintech operations in Nigeria. In December 2023 the Nigeria Inter-Bank Settlement System (NIBSS) directed the removal of non-deposit-taking institutions from transfer lists, and in 2024 the CBN reportedly ordered several fintech start-ups, including Moniepoint and OPay, to stop onboarding new customers. The fine is Paystack's largest publicly known regulatory penalty since it received CBN approval in 2016. The Lagos-founded company is owned by Stripe. Zap has also faced a separate trademark infringement lawsuit brought by Zap Africa.
Paystack said it was working closely with the regulator as it further reviews Zap and that, out of respect for the process, it would not make any public comment at this time.
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