FairMoney in 2024: How a Credit-Led Fintech Became One of Nigeria’s Leading Digital Banks

An In-Depth Analysis of FairMoney’s FY 24

FairMoney is a Nigerian digital bank and lending platform that has rapidly grown since its launch in 2017. It offers instant loans via a mobile app and has expanded into banking services like accounts and payments [1]. The company reports having over 17 million app downloads, positioning itself as one of Nigeria’s leading neobanks [2]. This essay analyzes FairMoney’s commercial performance in Nigeria for the financial year 2024, using data from a now-deleted Twitter thread by @rufyb.

If the thread was full of shit, then we've written a billion words on a foundation of shit.

But if it isn't...

...well, it's some good content.

Anyway, we try to assess key metrics and put the results in context of the broader industry.

We’ll examine FairMoney’s revenue growth, profitability, expenses, loan portfolio quality, and funding sources, and explain these concepts in simple terms. We’ll also consider FairMoney’s market position, competition, and fintech industry trends in Nigeria to give a well-rounded view.

FY 2024 Key Financial Highlights

- Revenue (Gross Earnings): ~₦121.9 billion in FY 2024, up about 62% from ₦75.3 billion in 2023 (driven by interest on loans).

- Net Profit After Tax: ₦5.85 billion in 2024, a sharp rise from ₦0.78 billion in 2023, marking a turnaround to strong profitability.

- Loan Book: ₦68.5 billion in total loans and advances as of Dec 2024, approximately 80% higher than the ₦38.0 billion a year earlier (significant loan growth).

- Customer Deposits: ₦73.0 billion in deposits from customers, up from ₦42.2 billion in 2023 (about 73% growth, indicating successful deposit mobilization).

- Loan Impairment (Provisions for Bad Loans): ₦59.4 billion expense in 2024 to cover potential loan losses, up 30% from ₦45.6 billion in 2023 (reflecting high but improving asset quality challenges).

- Operating Expenses: ₦41.8 billion in 2024, more than double the ₦18.4 billion spent in 2023, as FairMoney expanded its operations and team to support growth.

(“FY” refers to full-year financial results; all amounts are in Naira.)

Revenue Growth and Loan Expansion

FairMoney’s revenue comes largely from interest on the loans it gives to customers. In 2024, gross earnings (total revenue) reached about ₦121.9 billion, a big increase of ~62% compared to 2023. This surge in revenue was primarily driven by the expansion of FairMoney’s lending business. The interest income (money earned from loans) alone was ₦116.3 billion in 2024, comprising the bulk of revenue. Non-interest income (like fees and other charges) remained small at around ₦5.6 billion, meaning about 95% of FairMoney’s earnings came from lending. In simple terms, FairMoney made much more money in 2024 mainly because it issued many more loans and charged interest on them. The loan book (the total amount of loans outstanding) nearly doubled year-on-year – growing to ₦68.5 billion by the end of 2024 from ₦38.0 billion in 2023 – as the company reached more borrowers. Such loan growth reflects strong demand for FairMoney’s credit services and the firm’s ability to disburse larger volumes of loans. It’s worth noting that Nigeria’s high interest rate environment in 2024 allowed lenders like FairMoney to earn high interest on loans [3]. Essentially, customers were willing to borrow at high rates – sometimes up to ~100% annual interest in the digital lending market [4], [5] – and this translated into much higher interest income for FairMoney.

However, revenue growth wasn’t just about charging high rates; but also about scale – FairMoney significantly increased the number of loans and customers. The company has positioned itself as a convenient source of quick loans via its app (loans can be approved in minutes). This convenience helped FairMoney acquire millions of users and disburse loans rapidly. In fact, the company has stated it was disbursing roughly one loan every 10 seconds at peak times [6]. By 2024, FairMoney’s broad user base and aggressive lending pushed its interest earnings to new heights. Industry data shows that along with startups like Carbon and Renmoney, FairMoney is considered one of the dominant digital lenders in Nigeria [4], underscoring its ability to capture a large share of the market’s lending demand.

Profitability: From Breakeven to Solid Profits

FairMoney’s profitability saw a remarkable improvement in 2024. The company went from a very modest profit in 2023 to a much larger profit in 2024. Profit after tax for 2024 was about ₦5.85 billion, roughly 7.5 times higher than the ₦0.78 billion profit in 2023. Simply put in 2023 FairMoney was almost at a breakeven point (making only a small profit), but in 2024 it managed to earn a substantial bottom-line profit. This jump indicates that the business became more efficient as it scaled up – revenue grew much faster than certain costs.

One way to understand this is to look at net interest income after impairment, which is essentially the core income from lending after accounting for loan losses. In 2024, after FairMoney earned interest and then set aside money for bad loans, it still had ₦46.6 billion in net interest income remaining – more than double the equivalent amount in 2023. This shows that despite heavy provisioning (which we’ll discuss under asset quality), the underlying earning power of FairMoney’s loan portfolio improved significantly. In addition, the company’s operating income (income after all interest and fee revenues minus loan loss provisions) was ₦52.2 billion in 2024, up from ₦21.3 billion in 2023, giving it much more room to cover operating expenses and still have profit left over. Ultimately, profit before tax reached ₦10.4 billion in 2024 (versus ₦2.9 billion in 2023), and after taxes, net profit was ₦5.85 billion. This translates to a net profit margin of about 4.8% (profit as a share of revenue) in 2024 – still a single-digit margin, but a big improvement from about 1% margin in 2023. In everyday terms, for every ₦100 FairMoney earned in 2024, it kept roughly ₦5 as profit after all expenses, whereas in 2023 it kept only around ₦1. This improvement in profitability suggests that as FairMoney grew its revenues, it could better absorb its costs and losses, turning growth into genuine profits.

It’s important to note that high profitability is not automatic in the digital lending business – many fintech lenders struggle with losses due to high default rates and operating costs. FairMoney itself had a setback in 2022 when it recorded a net loss (due to very high loan impairments that year). The return to profit in 2023 (albeit small) and the strong profit in 2024 indicate a turnaround. It implies that FairMoney’s credit models and operational efficiency have improved. The company likely benefited from economies of scale – as it grew, certain costs grew more slowly than revenue. We will see below that while operating expenses did rise substantially in 2024, they did not erase the revenue gains.

Operating Expenses and Efficiency

Running a growing fintech like FairMoney involves significant costs – from salaries and technology infrastructure to marketing and customer support. In 2024, FairMoney’s operating expenses (all the day-to-day costs of running the business, excluding interest costs) jumped to ₦41.8 billion, up from ₦18.4 billion in 2023. That’s more than double the previous year’s expenses. At first glance, such a rise might seem concerning, but it was largely planned and necessary to support FairMoney’s rapid growth. The company expanded its team and services aggressively: for instance, FairMoney’s employee count grew by about 33% in a year [7], crossing 1,000 employees. Hiring more staff, investing in product development, and marketing to acquire new customers all contribute to higher costs.

Despite the big jump in expenses, FairMoney’s cost efficiency actually improved slightly because revenue grew even faster. A useful ratio to consider is the cost-to-income ratio, which compares operating expenses to operating income. In 2024, FairMoney’s operating expenses were about 80% of its operating income (₦41.8b expenses vs ₦52.2b operating income), whereas in 2023 expenses were about 86% of operating income (₦18.4b vs ₦21.3b). Lower is better for this ratio, so this indicates a small improvement. Although FairMoney spent a lot more money in absolute terms, those expenses were more than matched by the increase in income. The company managed to keep costs under control relative to its size. This is a positive trend because scaling up is makes the business more cost-efficient over time.

The biggest components of operating costs for a lender like FairMoney are personnel (staff salaries) and other administrative expenses (offices, customer support, etc.), along with tech infrastructure. Given FairMoney’s growth, it likely invested heavily in customer acquisition as well – for example, marketing campaigns to attract new users and incentives for people to start using FairMoney accounts or take loans. Each new customer brings in more deposits or loan demand, which eventually boosts revenue, so these expenses can be seen as investments in future growth. The fact that FairMoney still achieved a healthy profit despite doubling its expenses suggests these investments are paying off.

FairMoney’s expenses rose in 2024 due to expansion, but the company maintained a good balance between spending and earnings. It became slightly more efficient, indicating that management is sustainably scaling the business. Investors and analysts often watch this closely: an improving cost-to-income ratio means the company is not just growing, but growing wisely by reining in overhead costs as a percentage of income.

Additionally, FairMoney’s interest expense (the cost of funding, i.e. what it pays on customer deposits and any borrowed funds) was relatively low compared to its interest income. In 2024, interest expense was ₦10.2 billion against interest income of ₦116.3 billion – meaning it only paid out less than 9% of its interest earnings to depositors or lenders. This high net interest margin (the difference between what it earns on loans versus what it pays on deposits) is a key reason it can cover other expenses and be profitable. We will discuss funding in detail later, but in essence, FairMoney’s strategy of raising low-cost deposits (rather than relying purely on expensive debt funding) helped keep interest expenses modest. Traditional banks usually have this advantage – they gather deposits at relatively low interest rates and lend at higher rates [3]. FairMoney, by growing its customer deposits, is moving towards a banking model that enjoys cheaper funding.

Loan Portfolio Growth and Asset Quality

Since lending is FairMoney’s core business, the size and health of its loan portfolio are crucial. As noted, the loan book grew to ₦68.46 billion in 2024, roughly 80% higher than the previous year’s level. This growth signifies that FairMoney issued a lot more loans to customers in 2024. Growth can come from more borrowers, bigger average loan sizes, or both. FairMoney’s strategy has been to offer relatively short-term, unsecured loans via its app, often to individuals and small businesses that need quick credit. The convenience and speed (loans in minutes without heavy paperwork) helped FairMoney attract many borrowers, fueling this expansion in the loan book. However, rapid loan growth also brings the challenge of maintaining asset quality – in other words, ensuring that a good portion of those loans are repaid and do not turn into bad debts.

One indicator of asset quality is how much the company had to set aside for loan losses. In 2024, FairMoney recorded ₦59.45 billion in “impairment on loans and other assets,” which is the amount it provisioned for loans that might not be paid back. This is an extremely high number – nearly half of FairMoney’s revenue was essentially eaten up by potential credit losses. However, context is important. The impairment charge did increase from 2023 (it was ₦45.63 billion in 2023), but it grew only about 30% year-on-year, whereas the loan portfolio grew 80%. In relative terms, this suggests that the credit loss rate improved: FairMoney added a lot of loans and did not see bad debts rise at the same pace. This could imply better underwriting (making sure they lend to more reliable borrowers) or improved collections of overdue loans. It might also reflect external conditions: 2023 was a tough year economically in Nigeria and 2024, technically, was a better year so that helped borrowers repay more reliably.

I say "technically" because you also experienced Nigeria so... yeah.

Even so, ₦59.4 billion in provisions is massive – it shows that a significant portion of FairMoney’s borrowers still default or are likely to default, which is common in the unsecured digital lending space.

The fact that FairMoney remained profitable after taking such a large hit from impairments is notable. It indicates that the interest rates charged on good loans are high enough to compensate for losses on bad loans, which is the crux of the high-risk/high-return lending model. FairMoney’s effective annual yields on its loan portfolio were very high (well above 90% yield on average loans, according to its financial ratios), which is how it can sustain almost half the loans going bad and still come out ahead.

Regarding asset quality, the slight deceleration in impairment growth relative to loan growth is encouraging. It could mean FairMoney’s credit scoring algorithms – which likely use smartphone data and other alternative information to judge who is creditworthy – are getting better at screening out the riskiest borrowers. It could also mean that by 2024, FairMoney will have a more seasoned customer base (repeat borrowers who have proven reliable). That said, asset quality remains a major risk area. The company operates in Nigeria’s economy, which in 2024 faced high inflation and some instability; borrowers could struggle with the cost of living increases, making loan repayment harder. Many digital loans are also short-term (30 days, 3 months, etc.), and rolling them over can lead to debt cycles for consumers. The Federal Competition and Consumer Protection Commission (FCCPC) in Nigeria recognized issues in the digital lending space (like predatory lending and harsh recovery practices) and has been licensing and regulating digital lenders – over 200 of them as of early 2024 [4]. FairMoney, a licensed and well-capitalized player, adheres to these regulatory guidelines and ethical recovery methods (for instance, it can’t harass borrowers the way some loan sharks do). Unlike traditional banks, FairMoney doesn't have the advantage of collateral and payroll deductions for most, if not all, of their loans.

Funding Sources and Liquidity

To grow its loan book and business, FairMoney needs funding – money that it can use to lend out or invest. In 2024, FairMoney significantly reshaped its funding mix to rely more on customer deposits and less on outside borrowing. Customer deposits stood at ₦72.99 billion at the end of 2024, up from ₦42.24 billion a year earlier. These deposits are now the main source of funds for FairMoney’s lending. In banking, deposits are often the cheapest form of funding because, unlike institutional loans, deposits can carry low-interest costs (especially current or basic savings accounts). FairMoney has been aggressive in attracting deposits by offering high-yield savings products. It introduced savings plans – FairSave, FairTarget, and FairLock – offering 17% to 30% per annum, particularly for longer lock-ins [1]. These rates, well above what traditional banks offer, likely helped FairMoney rapidly grow its deposit base. By February 2025, the company reported over ₦35 billion in savings deposits and ₦3 billion paid in interest to users [1].

Although offering up to 30% interest seems expensive, not all customers lock money for that long. Many opt for the 17% flexible savings or goal-based plans around 20% [1], which lowers the average cost of funds. In 2024, FairMoney’s interest expense was ₦10.2 billion – implying an average cost in the mid-teens, still below the very high yields it earns on loans. In essence, FairMoney is operating more like a bank than the pure-play lender it used to be: it pays interest to attract deposits, then lends at much higher rates, profiting on the spread. This is a more scalable and sustainable model than relying solely on institutional debt or venture capital.

FairMoney also reduced reliance on other funding sources. Borrowings dropped to ₦1.52 billion in 2024 from ₦5.22 billion in 2023. “Due to related party” balances – likely funds owed to its parent company or affiliates – also declined to ₦1.53 billion from ₦5.37 billion. These reductions suggest that FairMoney repaid debt using incoming deposits. Notably, in 2023 FairMoney issued a ₦2.5 billion Series 1 Commercial Paper, which was oversubscribed and redeemed in March 2024 [8]. This redemption reinforced its credibility and market confidence. Subsequently, FairMoney launched further commercial paper series – including a Series 4 by April 2024 – confirming its growing access to institutional funding [9].

Having a large deposit base strengthens financial stability. Deposits tend to be “sticky,” especially when FairMoney serves as a primary bank account for users. With a Microfinance Bank license, FairMoney can accept and hold customer deposits, unlike the other pure lenders. In 2024, it had ₦8.2 billion in cash and ₦9.6 billion in investment securities as well – a ₦17.8 billion liquidity cushion.

Market Position and Competition

FairMoney operates in Nigeria’s highly competitive fintech and banking landscape. It faces competition from fintechs not focused on lending. Kuda started with free banking services; Moniepoint (TeamApt) serves businesses and is entering consumer banking. Traditional banks like GTBank, Access, and Zenith are launching digital lending apps—Access Holdings received approval in 2024 to launch Oxygen, a stand-alone digital lending platform [4]. While these banks benefit from cheaper capital and customer data, fintechs like FairMoney have a head start in credit scoring and user experience. Some industry insiders suggest banks may struggle to match fintechs’ agility and risk appetite [4], [3].

That said, its 2024 performance cements its status as a major player among Nigeria’s new wave of digital-first financial institutions. FairMoney’s focus has been “credit-led”: it acquired customers by meeting their immediate loan needs, then cross-sold other banking services (accounts, payments, savings). This strategy has paid off in terms of user growth and revenue.

In 2023, FairMoney acquired PayForce, a merchant payment platform, expanding into POS terminals and banking for small businesses [12]. This puts it in direct competition with players like Moniepoint, OPay, and Nomba. Few digital banks straddle both consumer and merchant segments; FairMoney’s ability to do so could be a long-term advantage.

Nigeria’s macro environment also plays a role. The country’s large, youthful population (~200 million), high inflation, subsidy removal, and 2023 cash shortages have accelerated digital banking adoption. These shifts likely contributed to FairMoney’s deposit surge and broader financial service usage.

Conclusion

FairMoney’s financial performance in FY 2024 tells a story of rapid growth and emerging maturity. The company achieved strong revenue growth powered by an expanding loan book and high-interest yields, and it impressively translated that into solid profitability after years of thin margins. Key financial metrics all moved in the right direction: profits climbed, profit margins widened, and cost-to-income efficiency improved slightly. FairMoney demonstrated that it can scale up (with loans and users) while keeping costs in check and managing the inherent risks of its lending business. Its expenses surged due to expansion, which was accompanied by even greater income, indicating effective scaling. Loan growth was robust, and while asset quality issues persist with high default provisioning, the company showed it can withstand those credit losses – essentially, its high-interest lending model is covering the risk costs as intended. By provisioning for bad loans, FairMoney is handling the issue head-on, and there are signs that credit risk may be stabilizing relative to the portfolio size.

On the funding side, 2024 was a year of transformation for FairMoney’s strategy. It significantly bolstered its funding sources by growing customer deposits. A stronger deposit base gives FairMoney a bank-like foundation to support future growth.

FairMoney’s success comes amid a fintech boom in Nigeria – a market with huge demand for credit. It faces stiff competition, but its performance indicates it’s among the front-runners in this space. The company leverages its early mover advantage in digital lending and has expanded into a full-service neobank to remain competitive. Industry trends like increased competition from banks and tighter regulations will pose challenges, but FairMoney’s 2024 results suggest it has the agility and financial footing to adapt. It is already aligning itself closer to a traditional bank model (in terms of funding and range of services) while keeping the agility of a fintech.

References

[1] Nairametrics, “FairMoney offers Nigerians 17% to 30% interest on their savings,” _Nairametrics_, Feb. 18, 2025. [Online]. Available: [https://nairametrics.com/2025/02/18/fairmoney-offers-nigerians-17-to-30-interest-on-their-savings/]

[2] TechCabal, “FairMoney ranked among fastest growing companies in Africa by Financial Times,” _TechCabal_, May 20, 2024. [Online]. Available: [https://techcabal.com/2024/05/20/fairmoney-ranked-among-fastest-growing-companies-in-africa-by-financial-times/]

[3] TechCabal, “Nigerian banks charge into digital lending market to beat fintechs,” _TechCabal_, Jan. 29, 2024. [Online]. Available: [https://techcabal.com/2024/01/29/nigerian-banks-digital-lending/]

[4] TechCabal, “Nigerian banks charge into digital lending market to beat fintechs,” _TechCabal_, Jan. 29, 2024. [Online]. Available: [https://techcabal.com/2024/01/29/nigerian-banks-digital-lending/#:~:text=Nigeria%E2%80%99s%20digital%20lending%20market%20is,and%20less%20stringent%20KYC%20requirements]

[5] TechCabal, “Nigerian banks charge into digital lending market to beat fintechs,” _TechCabal_, Jan. 29, 2024. [Online]. Available: [https://techcabal.com/2024/01/29/nigerian-banks-digital-lending/#:~:text=as%20high%20as%2030,lending%20platform%20QuickCredit%E2%80%94offer%20around%2021]

[6] Disrupt Africa, “Nigeria-based lending platform FairMoney pursuing emerging markets strategy with India launch,” _Disrupt Africa_, Apr. 23, 2021. [Online]. Available: [https://disruptafrica.com/2021/04/23/nigeria-based-lending-platform-fairmoney-pursuing-emerging-markets-strategy-with-india-launch/]

[7] Growjo, “FairMoney: Revenue, Competitors, Alternatives,” _Growjo_. [Online]. Available: [https://growjo.com/company/FairMoney#:~:text=,last%20year]

[8] Nairametrics, “Mycredit Investments Limited ‘FAIRMONEY’ successfully redeems debut Series 1 Commercial Paper,” _Nairametrics_, Mar. 12, 2024. [Online]. Available: [https://nairametrics.com/2024/03/12/mycredit-investments-limited-fairmoney-successfully-redeems-debut-series-1-commercial-paper/]

[9] Launch Base Africa, “Investor confidence soars as Nigeria’s FairMoney completes Series 4 Commercial Paper redemption,” _Launch Base Africa_, Apr. 25, 2024. [Online]. Available: [https://launchbaseafrica.com/2024/04/25/investor-confidence-soars-as-nigerias-fairmoney-completes-series-4-commercial-paper-redemption/]

[10] BusinessDay, “FairMoney disburses over N117 bn loans in 2021,” _BusinessDay NG_, Jul. 27, 2021. [Online]. Available: [https://businessday.ng/companies/article/fairmoney-disburses-over-n117-bn-loans-in-2021/#:~:text=In%20his%20welcome%20address%2C%20Hainy,all%20in%20one%20year]

[11] Techpoint Africa, “FairMoney raises $42 million Series B, bags banking licence to deepen operations,” _Techpoint Africa_, Jul. 2, 2021. [Online]. Available: [https://techpoint.africa/2021/07/02/fairmoney-raises-42m-seriesb/]

[12] WeeTracker, “Kuda Takes On Nigeria’s Hotly Contested Merchant Arena With POS Push,” _WeeTracker_, Jan. 8, 2024. [Online]. Available: [https://weetracker.com/2024/01/08/kuda-pos-merchant-acquiring-nigeria/]