Paystack, a Nigerian financial technology (fintech) company that provides online and offline payment solutions to businesses across Africa, has been fined N250 Million ($190,000) over its peer-to-peer app Zap, for stepping beyond regulatory boundaries.
According to a person familiar with the matter, the Zap fine is due to the platform allegedly operating as a wallet in violation of its regulatory license. The CBN claims that Zap launched in March this year, operates as a deposit-taking product reserved for financial institutions with a microfinance or banking licence.
Paystack holds a switching and processing license, which permits it to route financial transactions between banks and other institutions, but not to hold customer funds. That limitation is central to the CBN’s sanction.
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In line with this, a Paystack spokesperson disclosed that the company is working closely with the regulator as they further review Zap. The fine marks Paystack’s largest publicly known regulatory penalty since it received CBN approval in 2016.
Zap was launched in March 2025, a mobile app for instant, secure payments through bank transfers. Built on the same trusted infrastructure that powers millions of transactions daily, Zap is designed to eliminate friction in money movement, to enable users to make money transfers quickly and securely without delays or pending transactions.
According to Paystack CEO and co-founder Sola Akinkade, he noted that Zap was borne out of a need to start and finish bank transfers in under 30 seconds. This is why the product is focused on only bank transfers.
He further disclosed that instead of being another neo bank, Zap will allow Nigerians to link their existing bank accounts with the bank transfer app which they can use for quick bank transfers. While users can link multiple accounts on the Zap app, they will still get a Paystack-titan account. The linked accounts therefore serve as a way to fund the Paystack-Titan account instantly through direct debit without going to a bank app.
While the launch of Zap was poised to help users create a better bank transfer experience, the platform was entangled in a controversy over its name. Nigerian crypto startup Zap Africa, accused Paystack of trademark infringement, triggering a legal dispute that is still unresolved.
Shortly after the launch, Zap Africa issued a cease-and-desist letter demanding that Paystack immediately stop using the name Zap. The letter mandated Paystack to withdraw all product and marketing materials related to Zap, destroy any Zap-branded assets, issue a public apology, and cover Zap Africa’s marketing expenses all within seven days.
Zap Africa’s co-founders, Tobi Asu-Johnson and Moore Dagogo-Hart, stated that they had been building the brand for nearly three years, with trademarks filed across multiple classes 35 (business management), 42 (tech services), and most crucially, 36 (financial services), the same class Paystack now occupies.
“We secured Class 35 in late 2023, then got Class 42 in 2024,” Asu-Johnson told Nairametrics. “Class 36, which covers financial services, was the final one—and we got it just weeks before Paystack’s launch.”
“They tried to take everything, from our slogan ‘you just got zapped’ to brand colors and even the ‘Z’ symbol on our logo. It feels like a complete hijack of our brand”, he added.
Attempts to resolve the issue amicably failed, Asu-Johnson added, and frustration continues to simmer on both sides.
While Paystack declined to officially comment, a source familiar with the company’s position explained that due diligence had been conducted and that its trademark filings were sound.
“We filed for the ‘Zap’ trademark across multiple classes, including financial services,” the source said. “To our knowledge, Zap Africa didn’t have an active registration in Class 36 when we filed.”
This claim is now at the heart of the dispute. The similarity between both companies’ names lies at the heart of the legal dispute, one that could potentially set a precedent and reshape how Nigeria’s trademark laws are interpreted and enforced.