As technology changes, the banking sector has been adopting new and innovative ways of doing business. Digital or challenger banks are the new wave across most countries. By offering customers better terms, they are taking over markets in the U.S., U.K, Canada, and now Nigeria.
Unlike the traditional brick-and-mortar banks in Nigeria, these neobanks offer the same banking services at less or no cost, with better customer service and focusing on disruptive products and features. If you are in Nigeria, here are some digital banks you can sign up for.
- Free Debit Card
- 25 free transfers every month
- Budgeting Tools
- Kuda Overdrafts
- 15% annual interest on savings
- Connect account to Payoneer
Kuda bank is a digital bank with base operations in Lagos, Nigeria. Founded by Babs Ogundeyi and Musty Mustapha, this Central Bank-licensed microfinance bank aims to help its customers get the best banking services without incurring excessive charges.
Kuda’s key features include a free debit card known as the Kuda Card and comes at no maintenance fee. Once you sign up, the bank will deliver the card to you for free, and you can access your cash at over 3,000 ATMs at no extra cost.
An account at Kuda Bank comes with 25 free transfers to other banks each month. You can save up to 15,000 naira every year.
The bank also allows you to send money without an account number. Using a payment link, you can send faster transfers to anyone who has a smartphone.
Your money is safe with the bank because all deposits are insured by the Nigerian Deposit Insurance Corporation (NDIC). In addition, Kuda also has a Fixed Savings plan in which you can lock down lump sums of money and earn up to 15% annual interest.
The budgeting tool from this bank helps customers create a budget and track their spending and saving habits. The Spend+Save feature will help you reserve cash even after you’ve set a budget. With this feature, you can set a small percentage to save each time you spend money from your account.
This bank is ideal if you want short-term loans. As long as you use your account often, you become eligible for Kuda overdrafts.
The Kuda mobile app is available on Google Play with a rating of 4.3/5 and the App Store with a customer rating of 4.7. All the bank services can be accessed via the app.
- Current account
- Savings account
- Personalized money tracker
- Scheduled Transfers
- Instant Loans
- Mutual Funds at 30.5% per annum
Mint is a digital bank based in Nigeria. The Mint account is provided by Finex Microfinance Bank Ltd, which is licensed by the Central Bank of Nigeria. This bank offers a wide range of products from current and savings accounts, low-interest loans, and a personalized money tracker.
Once you open a current account, it comes with no maintenance fees or transaction charges. With the savings accounts, you can opt for the goal-based savings plan, earning you up to 36.5% interest. The safety of your deposits is critical. The NDIC insures all deposits.
You can also choose to build emergency savings or round-up savings. With the round-up option, Mint will round up cash from your transactions to the nearest hundred or thousand, transfer them to your savings, and earn you up to 15% interest.
The personalized money tracker limits how much cash you spend, helping you manage your money better. Using the app, you can schedule money transfers. You simply set up the beneficiaries, choose the frequency and enter the amount.
With the app, you can also apply for instant loans before your payday. To be eligible, the Mint account needs to be your salary account for about 2 months.
In addition, you can also diversify into investments. With N5000 in your Mint Mutual funds, you can earn as much as 30.5% per annum on your investment.
The Mint mobile app, known as MyMintApp, is available for both iOS and Android. On the App Store, it has a customer rating of 4.6/5 and 4.3 out of 5 stars on Google Play.
- Current account
- Savings account with 10% annual interest
- Instant Loans
- Free virtual dollar card
- Corporate banking
ALAT is Nigeria’s first full-service digital bank. Launched in 2017, this bank is owned and operated by Wema Bank. Wema was the first institution to introduce mobile banking in Nigeria in 2011 and disrupted the industry with the first digital bank several years later.
Signing up for an account takes a few minutes. The bank only needs your phone number, BVN, full name and address, and no extra paperwork.
Their savings account and Savings Goal feature give a high-interest rate, about three times more than the standard bank. You can sign up for an automated savings plan which can earn you 10% annual interest.
ALAT also offers its customers a free virtual dollar card once they open an account. With this feature, you can convert your naira to dollars and make payments or purchase products at any time.
To make transfers and payments, you can easily fund your ALAT account from a Wema Bank current account if you have one, from your savings, or another bank directly from the app.
ALAT mobile apps are available on the App Store and Google Play. With a customer rating of 3.3 and 3.8 out of 5 stars, respectively, the apps have many negative reviews due to poor functionality.
- Sparkle Stash
- Virtual and Physical Sparkle cards
- Spending breakdown
- Sparkle inventory for businesses
Sparkle was launched in 2019 by the former Chief Executive Officer (CEO) of the defunct Diamond Bank, Uzoma Dozie. Based in Nigeria, the bank offers its customers both personal and business accounts. Since its launch, the bank has handled more than $ 16 million in transactions, has over 400 million naira in deposits, and has over 20,000 customers.
Opening a Sparkle account is pretty direct and takes 5 minutes via a smartphone. The accounts also come with a breakdown feature to give you insight into your spending.
To save your cash, Sparkle Stash allows you to personalize your plan. You can either save by taking a percentage off all your debit transactions or saving together with a group of other Sparklers.
The other saving alternative allows you to earn 3.75% per annum interest rates if you have a minimum amount of ₦ 100,000 in your Sparkle stash.
With SparklePay, customers can send and receive payments with the use of a uniquely generated payment link. Once you create the unique link, you can add a custom message and the amount to send. Your recipient will open the link via the app or website to access the funds.
To make payments and transactions, Sparkle has virtual and physical cards. They are both secure to be used on the app, at physical stores, or online. If your physical card gets lost, you can deactivate it via the app.
For business, this bank has features to help manage operations. Companies can access inventory, invoice tools, taxation, and payroll tools using the app or website.
If you need assistance from the Sparkle team, they have their own AI lifestyle and financial chatbot, known as Indy, to respond to all your queries. The app is available for iOS and Android systems.
- No-fee transactions
- Target Savings
- Cardless Withdrawals
- Budgeting Tools
- Joint accounts
Vbank, also known as V by VFD, is a digital bank based in Lagos, Nigeria. It’s owned by VFD Microfinance bank, which is a member of the VFD Group. The bank offers a wide range of products to individuals and businesses, from fixed savings, instant loans to cardless withdrawals.
Vbank has zero charges on transactions and account maintenance and offers its customers a monthly interest on savings.
Signing up for an account requires you to fill in your phone number, email address, full name, BVN, password, and provide a photo for verification. You can easily register using the mobile app available on Google Play and the App Store.
With a feature like Veelage, users earn between N30K and N2m monthly by sharing a referral code with their network. As more accounts use this code, your earnings also grow.
Vbank has one of the best interest rates on a fixed account in Nigeria. They offer their customers up to 14% interest on these deposits.
You can also opt for the V Target Savings alternative. The bank will match 20% of your first contribution towards the desired target amount and offer an 8% compounded interest per annum with this savings account.
The bank also just introduced a new feature, the Joint account, for couples or customers who would like to save together. With the V Joint Account, you can either have multiple cards for the same account or multiple operators for the same account.
- Current Account
- Savings Account
- Money Request
- Business banking
- Virtual cards
Rubies is a fully digital banking platform based in Nigeria. It offers zero-fee banking targeting businesses, millennials, young professionals, SMEs, Fintech companies, and financial institutions.
The bank has a well-functioning mobile app for iOS and Android that customers can access all banking services.
The money request feature can be used to get cash from someone. Once you send the request and they accept, your account will be credited. You also have the power to decline, approve, or blacklist requests sent to your account.
The savings account is essential for setting goals. It provides flexible plans allowing you to monitor your goals.
For payments and ATM transactions, the Rubies debit Naira card is absolutely free. You can order one from the app. You can additionally request a virtual dollar card to use for online transactions and payments.
- Current account
- Savings account
- Cardless ATM withdrawals
- Virtual dollar cards
- Zero-interest loans
Eyowo digital bank was launched in 2019 in Lagos, Nigeria. This bank has unique features that allow customers to send, receive, save, spend and borrow money using only a phone number. The account opening process is direct; you only need a phone number.
The bank also offers customers zero-interest loans, which is very uncommon. They also have virtual cards for customers to use when shopping online. These cards are helpful for Micro Small Medium Enterprises (MSMEs)
To access Eyowo banking services, you can use the website, mobile app or use the Unstructured Supplementary Service Data (USSD) code: *4255#
- Savings account
- Current account
- Cardless withdrawals
One Bank is a 100% digital banking service owned and operated by Sterling bank. Once you register, you can instantly make payments, invest and borrow money via the app.
One Bank has different types of accounts, including the Classic and Domiciliary current and savings accounts, TrybeOne targeted at campus students, and Kia Kia accounts for individuals without documentation or ID cards. The I Can Save account is primarily for savings; parents can put away some cash for their kids.
The bank also offers businesses loans of up to N5 million naira without any paperwork or collateral.
The One Bank app can be downloaded from the App Store and Google Play.
What to Consider When Choosing a Digital Bank in Nigeria
Digital banks offer customers tons of benefits. Here are some of the key features you should look out for when selecting a Nigerian neobank.
- Financial Products
Like other banks, these digital banks have different financial products and features. Whether it’s a savings account, spending trackers, or loan services, you should choose the bank with the features that suit your financial needs.
- Digital Tools
Most of these digital banks in Nigeria have physical and virtual cards. These virtual are a good alternative because customers can use them when shopping online and paying in dollars. A bank with such tools makes it easy to process transactions and payments across the globe.
In addition, the bank should have a well-functioning mobile app available on either App Store or Google Play. Since the banks don’t have a physical presence, the app makes it easier to monitor and carry out transactions on the go.
- Savings Account Interest Rates
The Nigerian digital banks offer reasonable high interest on savings. You should choose a bank with a suitable rate depending on your savings goal.
Digital banks are on the rise in Nigeria. With better terms, zero fees, and online banking services, they provide better services than traditional banks. We have discussed some of the options you could use if you’d like to switch to a digital bank.
Before signing up for one of these banks, ensure that their services meet your financial needs and you can manage your money better.