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How to Set up a Digital Bank in Nigeria – A Step-by-Step Guide

What are the prerequisites to setting up a digital bank in Nigeria? Where do you start? What you need to put in place before you can actually begin operating? And how much does it cost to set up an online or digital bank in Nigeria? This guide will walk you through the process step-by-step, from coming up with your business idea and registering the business, all the way through hiring your first employee. At the end of this article, you will know everything you need to know about setting up an online or Digital bank in Nigeria. Let’s get started!

Step 1: An Introduction to Digital Banks

In recent years, digital banks have gained traction around Europe and other parts of Asia. Much like traditional banks, they offer accounts, loans and savings accounts but they do so digitally and on mobile devices. Their popularity comes from their convenience: users can complete transactions on their phone while standing in line at a supermarket or sitting on public transportation. Digital banks also boast lower fees than traditional financial institutions because they don’t have brick-and-mortar locations (or tellers) that require maintenance.

Step 2: Create A Business Plan for Your Digital Bank

The first step to setting up your own digital bank business is creating a business plan. A business plan is an outline of your business idea and can be used as a template for marketing, getting funding and more. The most important part of creating a business plan is making sure it’s tailored to your market, your sector and you. Be specific about what your target market is, who you will sell to them, how much money you will make from them and how that fits into growth and profitability targets over time.

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Step 3 : Register Your Digital Bank

To start operating your digital bank in Nigeria, you will need to register your business in with the corporate affairs Commission of Nigeria as limited liability company. To get that done please talk to your lawyer or visit the CAC website for more details on business incorporation.

Once your digital bank is registered and you get a certificate of incorporation from Corporate Affairs Commission (CAC). Next is Congratulations! Your digital bank is almost ready for launch but you still need to get a digital bank operating licence from Nigeria Communication Commission (NCC) and the Central Bank of Nigeria (CBN).

Step 4 : Applying for an NCC License to Operate a Digital Bank in Nigeria

To start, you will need to apply for an NCC license, which acts as your digital banking license in Nigeria. This is usually done by applying directly through NCC and taking care of all pertinent details such as submitting company names, physical addresses, corporate documents and more. Once approved, you can begin moving on to other important steps in starting your digital bank. You can read more about how to get a digital banking license in Nigeria.

Step 5: Obtaining a Bank License from CBN to Operate a Digital Bank in Nigeria

Obtaining your license is easy if you have all of your documents, and an idea of what you need to do. To get started, you must first apply for your operating license from the CBN. After paying all necessary fee, CBN will review your application and grant or deny you a digital bank operating license. If approved, then congratulations!

Step 6 : Source for Startup Capital for Digital Bank In Nigeria

These are just a few important things to consider when starting a digital bank in Nigeria. The most important one is to make sure you have enough capital on hand before opening shop. After all, banks don’t make money by lending out other people’s money — they make money by charging interest on loans they give out themselves. A good rule of thumb: If you want to start small, aim for ₦25 t0 N30 million startup capital for your digital bank in Nigeria, which should be enough capital for six months of operations.

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Step 7: Choosing a Payment Gateway Provider for your Digital Bank

Picking an online payment gateway service is one of the most important decisions you will make as an online entrepreneur. Your payment gateway company will be in charge of securely storing your customer’s financial information and transferring their money into your business account, so choosing one that aligns with your values is vital. As you sift through prospective options, consider these things: How long has it been around? What sort of security precautions does it take? Is there a fee associated with setting up an account?

Step 8: Choosing an e-Wallet Provider for your Digital Bank in Nigeria

How to Get your Digital Bank License in Nigeria, and How to open an e-Wallet Account. Starting a digital bank is not as difficult as it may seem, but getting approval from all of the necessary authorities can be time consuming and frustrating. Before you begin making plans for how you will launch your business, make sure you have everything you need. There are two main steps that must be taken before you can start operating as stated above : 1) You must apply for a license with the Central Bank of Nigeria (CBN), which will allow you to operate as a financial institution; 2) You must sign up for an e-wallet account with one of several approved providers.

Step 9: Hiring Staff for your Digital Bank

Once you have completed your training on how to operate a digital bank and have enough clients, then it’s time to hire staff. Keep in mind, however, that employees aren’t just going to appear out of thin air. You have to let people know what type of jobs you need filled, and you may even have to go looking for them yourself by placing advert in national Newspapers or in an online job platforms.

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NOTE: Employees come with different benefits depending on their positions within your company. For example, a receptionist will need to know how to greet clients and direct them where they need to go; an accountant will need to know how to balance books; a web developer will need knowledge of HTML5, CSS3, JavaScript and more. There are many other job titles as well; it’s up to you what type of employees you want working for your business.

Step 10: Establishing Customer Relationships Through Various Channels

In order for your digital bank business to survive, it needs a steady stream of new customers. Here’s how you can keep them coming through your door This is where things get interesting. This section focuses on how to find and attract new customers, as well as how to establish customer relationships through various channels (social media, email marketing, etc.). Remember: a happy customer is more likely to refer you than an unhappy one! If they have a good experience with your digital bank products or services (and if they think that their friends would benefit from it too), they will be more than happy to share their experience with others.

Step 11: Designing your ICT Infrastructure for Your Digital Bank

Once you have got your digital bank operating license, it’s time to lay out your infrastructure. Remember – ICT stands for Information Communications Technology. If you can do that digitally, all the best. But don’t worry if not you still have plenty of options when it comes to setting up shop. You might be wondering how much you should invest into setting up your office and equipment for your digital bank. To give you an idea, here are some common costs involved:

-Rent (if applicable): ——–

-Cables: ———

Phone System:——–

-Workstations/Computers/Software Licenses (per employee): ———

-Printers/Scanners/Fax Machines (per employee): ——–

-Smartphones or Tablets (per employee): ———-

Conclusion

I believe that with this Step-by-Step Guide, I’m sure you now know what it takes to start a profitable digital bank in Nigeria.

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