The Central Bank of Nigeria (CBN) has approved the licence for MTN's Mobile Money (MoMo) Payment Service Bank in the country.

This will extend its services to wider banking operations.

Mobile money is a growing contributor to MTN Nigeria's income, and the new banking licence would allow the company to explore growth opportunities presented by the country's unbanked population.

MTN Group Chief Executive Officer, Ralph Mupita, told South African media Fin24 that granting the final approval to commence the operations of MoMo Bank was an "important milestone" for the company's  Ambition 2025 strategy unveiled a year ago.

Nigeria, the continent's populous nation, is MTN's largest market.

Mobile money is an electronic service that enables users to send and receive money, make payments and perform other transactions using their mobile phones. 

The system is used across a number of MTN's African markets, including Zambia, Ghana, Cameroon and the Democratic Republic of Congo.

In January 2022, MTN revealed that MTN Nigeria's mobile money service had attracted 9.4 million active users since launching in August 2019, a growth the company said  provided a "solid foundation" for the upcoming establishment of the bank.

The company says the bank will "provide a powerful platform to drive digital and financial inclusion in Nigeria". The volume of transactions performed through the service rose by 167% to 137.5 million in the 2021 full financial year.

Today, mobile communication companies are venturing into various fintech-based services to diversify their income, and banking services have been a key area of growth.

Details on the commencement of operations are expected to be announced next month.