Sterling Bank, a Nigerian bank with a market capitalization of ₦115.16 billion, is pitching its new custom-built core banking application software, SEABaaS, to financial institutions and fintech companies.
Two people familiar with the matter said the bank has pitched SeaBaaS to MoMo, MTN’s Mobile Money business. This is consistent with the bank’s plan to save costs by building its own core banking application software and then licensing it to other banks and financial institutions.
People familiar with the matter said Sterling is also pitching to fintechs because SEABaaS was built to give Sterling Bank the nimbleness of a fintech. Sterling has been more adventurous than other banks in its category, creating asset financing products, focusing on sleek user experience on its banking app, and launching Alternative Bank, a non-interest bank. With several products and even more in development, Sterling hopes to convince fintechs who want to move fast and break things that SEABaaS is perfect for them.
Sterling Bank and MTN MoMo did not immediately respond to a request for comments.
Beyond the fintechs, it also hopes to attract business from other banks. With tier-1 banks billed to spend ₦80 billion on licencing fees for core banking software in 2024 alone, SEABaaS may be a cheaper offering. Yet, people familiar with the matter say the banks will not be an easy sell.
“Most banks will likely wait it out until they see how SEABaaS handles end-of-year operations,” one person familiar with banking technology told TechCabal. For banks, the end of the year is a crucial period where accounts have to be balanced and transactions reconciled in preparation for the new year.
SEABaaS was jointly built by Bazara Tech Inc, Peerless Technologies, and a third company that has not yet been disclosed. It is unclear how much Sterling spent to develop the software, but the bank was keen to localise cost, people familiar with the matter said. Banking software like Finacle and Temenos are priced in dollars. It will likely make some inroads with tier-2 banks keen to localise costs.
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