Blockchain for Banking News

Nigeria’s Zone interbank blockchain raises $8.5m

nigeria blockchain banking

Today Nigeria’s Zone announced it raised $8.5 million in funding led by Flourish Ventures and TLcom Capital and including Digital Currency Group (DCG) as a backer. The company has a regulated ‘Layer 1’ blockchain, which supports blockchain-based payments, particularly for incumbent organizations such as banks and payment providers. While the term Layer 1 makes it sound like a permissionless blockchain, it’s currently closer to being a financial market infrastructure. 

It has a central bank license and relationships with more than 15 banks and fintechs, although they’re not all onboarded yet.

The company was previously known as AppZone, which is now an umbrella brand that covers another business, Qore, a banking-as-a-service solution provider. The Qore arm has hundreds of clients. 

“For the first time in Africa, Zone’s technology enables direct communication between participants in the payment ecosystem,” said Ameya Upadhyay, Partner at Flourish Ventures. “We believe this is a fundamental leap that will allow customers to experience a completely new standard of reliability, speed and cost efficiency at the ATM, at POS machines and online.

Connect all monies using blockchain

The blockchain supports various kinds of fiat payments. Additionally, it bridges to public blockchains, CBDC infrastructure and legacy financial systems. Its mission is “to connect every monetary store of value using blockchain”.

Zone’s ‘Sovereign’ blockchain is a type of Ethereum-compatible permissioned network in order to be regulatory compliant and supports trusted entities as node operators. It’s described as enabling the transition to digital currencies. Currently the functionality supported includes agent banking, merchant payments, ATM withdrawals and fund transfers.

In 2022 the payments firm announced a provisional license with the central bank for transaction switching and processing services. The license allows it to integrate with Nigeria Central Switch and card payment schemes. 

One of the company’s most ambitious goals is to launch cross border payments next year. That will likely use stablecoins.