Why fintechs are charging ₦0 to sell Dangote shares
Nigeria’s biggest Initial Public Offering (IPO) should be a big payday for the fintechs helping investors buy it, but they are charging customers ₦0.
Dangote Refinery opened its ₦2.15 trillion ($1.62 billion) public offering on September 14, and investment platforms including Bamboo, Cowrywise, and PiggyVest are not charging users direct transaction fees after buying the offering.
These fintechs are waiving direct fees such as brokerage, stamp duty, trade alerts, and Value-Added Tax, because the bigger prize is the customer.
Dangote Refinery is offering 4.1 billion shares at ₦525 ($0.39*) each and wants to raise about ₦2.15 trillion ($1.62 billion) from the public by October 13, making it Nigeria’s biggest public share sale.
MTN Nigeria raised ₦111.75 billion ($293.31 million at ₦381/$) in 2021 from its public offering on the Nigerian exchange. In 2014, Seplat, an indigenous oil and gas operator, raised about $535 million through a dual listing on the London Stock Exchange and the Nigerian Stock Exchange.
Dangote Refinery’s minimum subscription is 10 shares (₦5,250; $3.95), and the company is targeting 10 million retail investors.
The last time a public offer in Nigeria generated this much buzz was in 2021, when MTN Group reduced its shareholding in Nigeria by 3.25 percentage points. The offer was oversubscribed by 139.7% and attracted 126,720 retail investors. It was also Nigeria’s first digital public offering.