What You Should Know About PayPal And Paga Nigeria Partnership

In a significant development for Nigeria’s digital economy, global payments giant PayPal has officially relaunched its services in the country through a strategic partnership with local fintech leader Paga.

Announced in late 2025 and going live in early 2026, this collaboration allows Nigerian users to receive international payments directly into their Paga wallets, marking the end of over two decades of restrictions that limited PayPal’s functionality in Africa’s most populous nation.

This move comes amid PayPal’s broader push into emerging markets, backed by a $100 million fund for African fintech acquisitions and partnerships, as the company seeks to reverse a 75.6% decline in its share price over the past five years.

The partnership enables seamless integration between PayPal accounts and Paga digital wallets, facilitating cross-border receipts from over 200 countries, instant withdrawals in Naira, and access to PayPal’s network of more than 430 million global users.

Users can now shop internationally, pay bills, transfer funds to banks, or spend via Paga’s Visa card, bridging global earnings with local needs. For merchants, it opens doors to accept payments in up to 25 currencies, potentially boosting exports and small business growth.

History of PayPal in Nigeria

PayPal’s relationship with Nigeria has been fraught with challenges since its initial entry into the market. The company first allowed Nigerian users to sign up in 2004 but quickly imposed strict limitations, restricting accounts to outbound payments only, no inbound receipts or local withdrawals were permitted.

PayPal cited high fraud risks, including the use of stolen credit cards via Nigerian IP addresses and deficiencies in the country’s identification infrastructure, as reasons for these measures.

These restrictions, initially described as temporary, persisted for nearly two decades, effectively excluding Nigerian freelancers, online entrepreneurs, and small businesses from one of the world’s largest payment platforms.

Many users resorted to workarounds, such as using VPNs or intermediaries in other countries, but these were often unreliable and costly. Accounts were frequently frozen without clear explanations, leading to lost funds and widespread frustration.

In the absence of full PayPal access, Nigeria’s fintech sector flourished independently.

Companies like Paystack, Flutterwave, Monnify, Kora, Grey, and Cleva emerged to fill the gap, providing cross-border payment solutions and processing billions in transactions annually.

Paga itself, founded in 2009 by Tayo Oviosu, was inspired by PayPal’s model, aiming to create a “PayPal for Africa.” Early attempts at collaboration, including Oviosu’s 2013 email to PayPal outlining potential partnerships, went unrealized until now.

Previous partnerships, such as a 2014 tie-up with First Bank for outbound payments and a 2021 collaboration with Flutterwave focused on businesses, failed to enable full inbound access for individuals.

PayPal’s absence reinforced negative stereotypes and hindered Nigeria’s integration into the global digital economy, but it also spurred local innovation, with digital payments soaring to ₦1.07 quadrillion ($754 billion) in 2024.

What the Paga and PayPal Partnership Means

This partnership represents a pivotal shift, potentially injecting much-needed foreign currency into Nigeria’s economy and enhancing financial inclusion in one of Africa’s fastest-growing digital markets.

With Nigeria being Africa’s largest remittance recipient, the integration could streamline inflows for gig workers, families, and businesses, reducing reliance on informal channels or cryptocurrencies. Currency conversions will occur at market rates, making it competitive with alternatives.

For users, getting started is straightforward: log into the Paga app or website, link a PayPal account (only Nigeria-registered ones qualify for receipts), and begin transacting.

Funds can remain in dollars or be converted to Naira for local use, and the setup even allows receipts from Venmo users in the U.S. However, some requirements, like providing a Bank Verification Number (BVN), have raised privacy concerns, as they differ from processes in other countries.

The implications extend to competition and market dynamics. PayPal’s entry could challenge established local fintechs, many of which have achieved unicorn status and process over $100 billion annually.

Skeptics warn of potential market consolidation, where PayPal might leverage local insights before sidelining partners, or continue with biased risk models that lead to account freezes.

With mixed reactions on social media, while some celebrate the milestone as a win for global access, others highlight alternatives like Cleva or Grey, questioning if PayPal’s return is too late or insincere.

Tayo Oviosu, Paga’s founder, emphasized the long-term vision, “This is about making global funds accessible locally in a simple, secure way.”

Otto Williams, PayPal’s regional head, added that the focus is on supporting local innovation and expanding inclusion. Paga, with its 21 million users and ₦17 trillion ($12 billion) processed in 2025, anticipates volume growth from international inflows.

Overall, the partnership signals Nigeria’s maturing digital infrastructure and PayPal’s strategic pivot to Africa, but its success will depend on building trust, addressing past grievances, and delivering reliable service amid stiff local competition.