PayPal is re-entering the African market, starting with Nigeria, as it commits $100 million to partnerships and acquisitions with fintech startups in a bid to unlock new growth opportunities and regain relevance in fast-expanding digital economies.
The payments giant had previously withdrawn from Nigeria, restricting its services to outbound payments only. At the time, PayPal cited concerns around fraud risks and weaknesses in the country’s identification infrastructure, a move that effectively shut freelancers, digital workers and small businesses out of one of the world’s largest global payment platforms.
Nearly two decades later, PayPal is returning with a new strategy anchored on collaboration rather than exclusion. The company’s new initiative, PayPal World, is designed to integrate PayPal with local digital wallets, allowing users to carry out both domestic and international transactions without opening foreign-based accounts.
In Nigeria, the rollout is being implemented through a partnership with Paga, enabling users to link their PayPal accounts directly to Paga wallets and access international payments through PayPal’s global network of more than 430 million users. Payments will be processed via a PayPal checkout button connected to local wallets, simplifying cross-border transactions for individuals and small businesses.
The renewed push into Nigeria comes at a critical time for PayPal. Growth in its core Western markets has slowed significantly, with the company’s shares down more than 75% over the past five years. This pressure has intensified the search for new revenue streams, particularly in high-growth markets such as Africa, where digital payments and remittances continue to expand rapidly.
When PayPal exited Nigeria, it blamed widespread fraud, including the alleged use of stolen foreign credit cards through Nigerian IP addresses, as well as gaps in national identity systems. While the restrictions were initially described as temporary, they remained in place for years, forcing Nigerian users to seek alternatives.
During that period, Nigeria’s fintech ecosystem evolved independently. Local payment companies and banks stepped in to fill the gap, building strong cross-border payment and remittance solutions that now process an estimated $100 billion annually. Several of these firms have grown into unicorns, reshaping the payments landscape and deepening financial inclusion for MSMEs and digital workers.
PayPal World, first unveiled in mid-2024 and scheduled for an Africa-wide rollout in 2026, has already been announced alongside partnerships in India, China and Brazil. According to the company, the platform allows users to retain their local wallets for everyday transactions while seamlessly accessing international payment services.
Nigeria is emerging as a priority market within this broader Africa strategy, given its position as the continent’s largest remittance destination and one of its most competitive fintech ecosystems. While PayPal maintains operations in several African countries, its renewed focus on Nigeria reflects the scale of opportunity and the urgency to offset declining performance elsewhere.
Despite the optimism surrounding the Paga partnership, skepticism remains among industry observers. Some local players worry that PayPal could leverage partnerships to gain market intelligence before sidelining smaller fintechs, while lingering concerns around frozen funds and transparency continue to shape public perception.
For MSMEs, freelancers and digital entrepreneurs, PayPal’s return could reopen access to global markets and foreign clients, but its long-term impact will depend on how well it balances competition with collaboration in an ecosystem that has matured without it.
