Stransact Blog

Tag: Featured

  • How Telecom Operators, Fintech and Retail Brands Can Leverage MVNO Licenses in Nigeria

    How Telecom Operators, Fintech and Retail Brands Can Leverage MVNO Licenses in Nigeria

    In 2023, the Nigerian Communications Commission (NCC) introduced a structured licensing regime for Mobile Virtual Network Operators (MVNOs) to enhance competition and expand digital inclusion. According to BusinessDay (2025), the NCC issued 46 MVNO licenses across five tiers, representing one of the most ambitious frameworks in Africa. However, as of August 2025, only two operators: Vitel Wireless and EmoSIM have commenced commercial operations. This disparity between policy ambition and market activation prompts a critical evaluation of Nigeria’s progress in telecom liberalization.

    Understanding Mobile Virtual Network Operators

    MVNOs deliver mobile services without owning radio access networks or spectrum. Instead, they lease capacity from incumbent Mobile Network Operators (MNOs) and differentiate through customer segmentation, pricing models, bundled offerings, user experience, and distribution strategies. Globally, MVNOs have demonstrated effectiveness in:

    • Stimulating innovation through niche offerings tailored to students, rural users, SMEs, travelers, and fintech-oriented customers.
    • Enhancing affordability by exerting downward pressure on retail prices and enabling targeted bundles.
    • Deepening market segmentation through localized content and flexible service plans.

    Nigeria’s Licensing Framework: A Step Forward

    The NCC’s five-tier licensing model represents a significant advancement in liberalizing the telecommunications sector. It accommodates varying degrees of operational independence, ranging from basic resellers to full-service providers with core network capabilities. This flexible structure is designed to attract a diverse array of market participants, including startups and established technology firms.

    Furthermore, the framework aligns with Nigeria’s National Broadband Plan and Digital Economy Strategy, which aim to increase broadband penetration and bridge the digital divide. In principle, MVNOs are well-positioned to extend connectivity to underserved regions and reduce data costs. The licensing tiers include:

    • Tier 1 (Reseller MVNOs): Focus on branding, distribution, and customer service, relying entirely on MNOs for network operations.
    • Tier 2 (Service Provider MVNOs): Manage customer care, billing, and select value-added services.
    • Tier 3 (Core MVNOs): Operate critical network elements such as the Home Location Register (HLR) and Home Subscriber Server (HSS), while leasing radio access.
    • Tier 4 (Aggregator/Enabler MVNOs): Aggregate network capacity and wholesale it to smaller MVNOs, reducing the need for direct MNO agreements.
    • Tier 5 (Full MVNOs): Function nearly as MNOs, operating core networks while leasing spectrum and radio access.

    Read more: International Tax Review (ITR) Ranks Stransact Chartered Accountants Among Tier-1 Firms

    The Execution Gap

    Despite a robust framework, market activation has been limited. BusinessDay (2025) reports that only Vitel Wireless and EmoSIM have launched commercially, out of the 46 licensed MVNOs. Several challenges have impeded progress:

    • Infrastructure Bottlenecks: MVNOs depend on MNOs for network access, and negotiations over pricing and service-level agreements have proven complex.
    • Market Readiness: Many MVNOs lack the technical and financial capacity to scale operations. The Nigerian market remains price-sensitive and dominated by a few major MNOs.
    • Regulatory Ambiguity: While the NCC has issued a licensing framework, there is limited clarity regarding enforcement mechanisms, dispute resolution, and consumer protection specific to MVNOs.

    Untapped Potential

    Nigeria continues to present substantial growth opportunities. Mobile internet adoption remains low, and millions of citizens are underserved or offline. MVNOs can address this gap by offering:

    • Localized propositions, including language-specific content and regionally tailored pricing models.
    • Flexible commercial models such as family wallets, shared data plans, and SME-focused bundles.
    • Embedded connectivity for fintech, edtech, and health tech applications, bundling data with essential services.

    According to Grand View Research (2025), the global MVNO market is projected to reach USD 137.31 billion by 2030, growing at a CAGR of 7.7%. Nigeria possesses the demographic and digital appetite to capture a meaningful share of this market, provided enabling conditions are established.

    Read more: Why IFRS 18 Should Be a Strategic Priority for CFOs and Financial Leaders

    Strategic Imperatives

    To realize the full potential of MVNOs, several strategic interventions are necessary:

    • Infrastructure Sharing Mandates: The NCC should enforce equitable access terms between MNOs and MVNOs to prevent anti-competitive practices.
    • Capacity Building: Technical and financial support for MVNO startups is essential to bridge the execution gap.
    • Consumer Awareness: Public education initiatives can enhance understanding of MVNO offerings and their value proposition.
    • Policy Integration: MVNO strategy should be harmonized with broader digital economy initiatives, including rural broadband expansion and financial inclusion.

    Read more: From Traditional to Digital: How Financial Services Can Thrive in the Era of Fintech

    Conclusion

    MVNO licensing in Nigeria is a commendable initiative with transformative potential. However, without effective execution, it risks becoming a missed opportunity. The regulatory framework is in place, market demand is evident, and digital inclusion remains a national priority. A coordinated effort by regulators, operators, and innovators is imperative to translate policy into tangible progress.

  • Why IFRS 18 Should Be a Strategic Priority for CFOs and Financial Leaders

    Why IFRS 18 Should Be a Strategic Priority for CFOs and Financial Leaders

    For years, CFOs and investors have struggled with varying interpretations of “operating profit,” making it difficult to compare performance and assess value accurately. The International Accounting Standards Board (IASB) is addressing this challenge with IFRS 18 Presentation and Disclosure in Financial Statements, a transformative standard effective January 1, 2027.

    More than a compliance update, IFRS 18 is a strategic shift, that establishes a disciplined framework that enhances transparency, strengthens audit reliability, and reinforces stakeholder confidence in financial reporting.

    The Core Change: A Structured Financial Narrative

    IFRS 18 introduces a disciplined framework for the income statement, requiring companies to classify all income and expenses into three distinct categories:

    • Operating: Core business activities
    • Investing: Returns from non-core assets
    • Financing: Costs of capital and interest

    It mandates three standardized subtotals:

    • Operating profit or loss.
    • Profit or loss before financing and income tax.
    • Profit or loss.

    This structure eliminates ambiguity and ensures that operating profit reflects only the results of primary business activities before financing and investment effects.

    Crucially, IFRS 18 also brings Management-defined Performance Measures (MPMs), non-GAAP metrics like EBITDA into the scope of audited financial statements. Companies must now reconcile MPMs to IFRS-defined subtotals in a dedicated note, ending the era of opaque investor presentations.

    Read more: National Repository Portal and Financial Reporting Compliance: A Guide for Nigerian PIEs

    Strategic Impact on Investment Valuation

    For investors, analysts, and valuation professionals, IFRS 18 is a game-changer:

    • Enhanced Comparability: Peer benchmarking becomes more reliable, especially for metrics like EV/EBIT.
    • Improved Forecasting: DCF and earnings models benefit from clearer categorization of recurring vs. non-recurring items.
    • Reduced Risk Premium: Greater transparency lowers uncertainty, potentially reducing the cost of capital.

    Example in Practice:
    A telecom company that previously highlighted EBITDA must now disclose it as an MPM, reconcile it to IFRS-defined operating profit, and explain adjustments, giving investors a clearer view of sustainable earnings.

    Challenges for CFOs: From Compliance to Competitive Advantage

    While the benefits are clear, the transition to IFRS 18 presents critical challenges for finance leaders:

    1. System Overhaul: ERP and reporting systems must be reconfigured to reflect new categories and subtotals.
    2. MPM Governance: CFOs must ensure consistency, audit readiness, and strategic alignment of disclosed metrics.
    3. Segment Reporting Complexity: More granular disclosures may require restructuring internal reporting frameworks.
    4. Stakeholder Communication: Investor relations must adapt messaging to reflect IFRS 18’s structure and disclosures.

    Example:
    A multinational with diverse business units must now present segment results using IFRS 18’s structure. This may require redefining KPIs and retraining finance teams across jurisdictions.

    The Strategic Imperative for Leadership

    C-suite leaders should view IFRS 18 as an opportunity to refine the company’s financial narrative and build deeper trust with the market. Key actions include:

    • Proactive Engagement: Initiate cross-functional discussions with finance, audit, and board stakeholders.
    • Strategic Communication: Develop investor messaging that explains the new presentation and its implications.
    • KPI Alignment: Reassess how the new definition of operating profit affects internal performance metrics and executive compensation.

    Read more: Risk-Based Auditing for Nigerian Non-Profit Organizations: Enhancing Accountability and Effectiveness

    Conclusion: A New Era of Financial Clarity

    IFRS 18 is more than a technical update, it is a strategic mandate for clarity, consistency, and credibility. Organizations that embrace this change proactively will not only meet compliance requirements but also strengthen governance, enhance valuation credibility, and command investor confidence in an increasingly transparent financial landscape.

    For business leaders and CFOs preparing for the implementation of IFRS 18, expert guidance can make all the difference. If you have any questions or would like to understand how IFRS 18 may impact your financial reporting and strategy, reach out to us at [email protected]; our team is ready to help you navigate the transition, strengthen compliance, and communicate financial performance with greater clarity and confidence.

  • FIRS Extends Deadline for Large Taxpayers on E-Invoicing & E-Fiscal System (EFS)

    FIRS Extends Deadline for Large Taxpayers on E-Invoicing & E-Fiscal System (EFS)

    The Federal Inland Revenue Service (FIRS) has announced a three-month extension for the mandatory onboarding and transmission of electronic invoices under the National E-Invoicing & Electronic Fiscal System (EFS) regime.

    This extension applies to Large Taxpayers (businesses with annual turnover of ₦5 billion and above) who are required to comply with the new Merchant-Buyer Solution (MBS) platform.

    While the E-Invoicing & EFS system officially went live on 1 August 2025, the deadline for full onboarding, integration, and mandatory compliance has now been shifted from 1 August 2025 to 1 November 2025. According to the FIRS, this adjustment recognizes the operational challenges faced by many taxpayers in meeting the initial timeline, despite the successful go-live of the platform.

    Presentation Slide: Merchant Buyer Solution e-Invoicing System

    What is the E-Invoicing & EFS System?

    The National E-Invoicing & Electronic Fiscal System (EFS) is a digital solution introduced by FIRS to modernize and streamline Nigeria’s tax compliance framework.

    Through the Merchant-Buyer Solution (MBS) platform, businesses will:

    • Issue invoices electronically in real-time.
    • Ensure transparency in transactions between buyers and sellers.
    • Enable automatic transmission of invoice data directly to FIRS.
    • Reduce risks of tax evasion, manipulation, or under-reporting.

    The system will also provide FIRS with more accurate transaction data, strengthening Nigeria’s tax administration and fostering a fairer business environment.

    Why the Extension Matters

    The extension offers taxpayers additional time to finalise their onboarding, integration, and compliance procedures. More importantly, it reflects FIRS’ commitment to encouraging voluntary compliance rather than penalizing businesses struggling with technical or operational bottlenecks.

    In its statement, the agency emphasized that the move is intended to create a smoother and more inclusive transition into the e-invoicing regime, allowing businesses to adapt without disruption to their operations.

    Read more: Navigating the Future of Tax Compliance: FIRS to Roll Out E-Invoicing in Nigeria

    FIRS’s Commitment to Support

    FIRS has pledged to continue working closely with stakeholders through engagements, technical support, and ongoing training programs. Businesses are encouraged to take advantage of this window to complete the necessary integrations and avoid last-minute compliance challenges.

    FIRS Executive Chairman, Zacch Adedeji, Ph.D., reaffirmed that the introduction of the e-invoicing platform is part of FIRS’ broader reforms aimed at modernizing Nigeria’s tax system, improving efficiency, and ensuring fairness in tax administration.

    Next Steps for Taxpayers

    With the new compliance deadline of 1st November 2025, large taxpayers are advised to:

    • Complete onboarding and system integration as soon as possible.
    • Train their accounting and finance teams on the use of the MBS platform.
    • Test invoice submissions to ensure smooth real-time reporting.

    Read more: Stransact, NRS upskill corporates on how to navigate Nigeria’s new tax landscape

    As businesses prepare for this transition, it is crucial to review existing invoicing and reporting processes to ensure full compliance with the new system. While the e-invoicing regime may present initial challenges, it also offers an opportunity to enhance transparency, strengthen controls, and improve efficiency.

    At Stransact Chartered Accountants, we are well-positioned to assist businesses in understanding the requirements, implementing compliant processes, and navigating any uncertainties. We encourage stakeholders to reach out to us for tailored guidance and support in adapting seamlessly to this reform.