How a Trademark War Revealed Paystack Launched Zap Without CBN Approval

When Paystack, the Nigerian payments startup, launched its first consumer product on March 24th, it was meant to be a comeback moment reminiscent of its acquisition by Stripe in 2020.

What began as a victory lap quickly became a reputational nightmare for one of Africa’s lauded payments companies.

The launch of Zap, a mobile app promising seamless bank transfers and wallet services, ignited a storm, not of applause, but of scrutiny. 

Within days, the trademark spat between Paystack and Nigerian crypto startup Zap Africa morphed into something far more consequential—a regulatory breach at the heart of Nigeria’s fintech space.

The issue? Paystack’s Zap, it turns out, was launched without the approval of Nigeria’s apex financial regulator, the Central Bank of Nigeria (CBN). 

As Big Tech This Week discovered during its investigation, that omission wasn’t just a minor administrative oversight—it may represent a violation of national financial laws with potential implications far beyond Nigeria’s borders.

Let’s get into it.

What we know

Moments after Paystack co-founder and CEO Shola Akinlade took the stage to introduce Zap during a live-streamed event branded An Evening With Paystack, Zap Africa tweeted: “There is only one ZAP in Nigeria and Africa”.

The tweet was a public assertion of ownership over a name Paystack had just draped across its new consumer product.

This sparked the beginning of a trademark war between the two companies. 

That tweet triggered a routine inquiry by Big Tech This Week into the trademark rights of both companies. But as we combed through reliable sources and filings from Nigerian and UK regulators, the inquiry unearthed a deeper, more troubling thread. 

Paystack’s Zap is operating without CBN authorisation.

“No approval was granted”

Zap by Paystack is a mobile app that provides instant, secure payments through bank transfers. Users can store money in digital wallets and link bank accounts to the app to create frictionless transfers between banks within seconds. 

Users can fund accounts using Nigerian and international cards, including Apple Pay. Zap also supports cross-border transfer, joining Nigerian fintech companies like LemFi and Flutterwave in a cross-border play.

The product was marketed as a new era for the company, whose DNA has long been rooted in B2B payments. However, sources at the CBN told Big Tech This Week that Paystack did not receive regulatory approval for Zap’s launch.

“No approval was granted”, a source at the CBN confirmed.

We asked, “Is Zap a product that requires approval, or could it benefit from Paystack’s existing payment or third-party infrastructure?” The source stated, “Definitely need CBN approval.” 

The source confirmed CBN is currently reviewing Zap and has asked Paystack to provide a detailed list of third-party partners, service architecture, and a formal application for product approval.

During his presentation at the event, Akinlade highlighted that Paystack owned a Payments License and a Switching Licence.

According to sources at the CBN, that license does not erode the requirement that Zap get prior approval before its launch.

The CBN source stated that if a product launches without the proper license, it reserves the right to shut it down or impose a fine.

Move fast and... get fined?

For startups in Nigeria’s fintech ecosystem, this situation underscores a broader tension between innovation and regulation.

“Startups like to move fast and break things,” a veteran fintech executive said under the condition of anonymity. “They flout the rules, ship the product, and try to clean it up with money later.”

But regulators are increasingly wary. The CBN mandates product pre-approval not merely for bureaucratic oversight but also to protect consumers and safeguard systemic financial integrity.

“As a fintech startup, even if you’re launching a new consumer product that does not require a license, you still need to inform and get approval from the CBN, another fintech executive explained. CBN needs to know what consumer protections you have in place in the event you go under. How does the NDIC cover it?”

The big picture

During Paystack’s Zap launch, Akinlade stated the company had worked on Zap for almost a year. The big question is why a well-established startup like Paystack launched a consumer product without getting approval from the industry’s apex regulator.

Big Tech This Week asked Paystack if someone dropped the ball on obtaining approval or if the company intentionally launched a product to consumers without approval.

We asked them, “Did Paystack launch Zap without CBN approval? Paystack said, “ZAP by Paystack is leveraging our existing CBN-approved payments infrastructure. We engaged the CBN as far back as last year about our plans to launch ZAP using these existing rails.”

Paystack’s response echoes what the CBN source earlier confirmed regarding Paystack launching Zap on existing rails. The source stated, “They definitely need CBN approval”.

Another fintech executive told Big Tech This Week that they confirmed Paystack’s investigation from a different CBN source, who said, “The CBN is investigating Paystack for launching Zap without approval.”

Across the pond

If Zap’s domestic regulatory situation was fraught, its international operations raised more eyebrows.

Shortly after launch, a Twitter user shared that he had used Zap to transfer money from his European account to Nigeria — a cross-border transaction typically reserved for companies licensed under Nigeria’s International Money Transfer Operator (IMTO) category.

Curious, we replicated the transaction, sending funds from a UK Monzo account to a Nigerian GTBank account via Apple Pay. The transfer was instant.

However, Paystack’s website states that Zap is currently available to users in Nigeria or visitors to Nigeria. We are neither Nigerian residents nor presently visiting the country. 

Paystack is also not listed among the CBN’s authorised International Money Transfer Operator Licences (IMTOs) or registered with the UK’s Financial Conduct Authority (FCA), which regulates financial services in the UK. 

One of the sources I spoke to stated that remittance is not a grey area. “When sending money/transactions with an international card, you need to get approval from the originating and destination countries you’re sending it to. Money crossing the border is remittances. Paystack does not have the authorisation to do remittances. They need the CBN’s IMTO Licence”.

Most major Africa-focused remittance startups, including LemFi, Nala, and Flutterwave, appear on the CBN’s IMTO List and the FCA’s Financial Services Register, but Paystack does not.

Could Paystack be operating under Stripe’s infrastructure, given its parent company’s FCA registration?

The FCA says no.

We contacted the FCA, and they confirmed that Paystack is not listed as an affiliate or agent of Stripe in their database or for regulatory purposes and, therefore, has no standing to offer cross-border remittances in or out of the UK.

“If a company is not listed on the FCA register, and it offers financial services in the UK, it does so without our permission,” an FCA official told us. “The onus is on the user, but we cannot protect them if anything goes wrong.”

In the UK, operating a fintech company or product without authorisation from the Financial Conduct Authority is a criminal offense, potentially leading to fines or imprisonment.

The FCA advised contacting the Nigerian regulator to determine how we could perform cross-border transactions between the UK and Nigeria. They gave us the Securities and Exchange Commission (SEC) phone number and email address. 

However, the SEC is not responsible for regulating cross-border transactions. The CBN is.

Trademark wars

Who owns the ‘ZAP’ trademark?

The original trademark dispute that sparked the inquiry remained unresolved as the regulatory revelations gained steam.

Paystack and Zap Africa claim ownership of the Zap trademark in Nigeria in Class 35, the coveted Class 36 and Class 42.

Both companies provided trademark documentation from the Ministry of Industry, Trade & Investment to Big Tech This Week to support their case.

Who filed first?

• October 8th, 2023: Zap Africa filed and applied for the trademark in Class 35.

• December 4th, 2023: Paystack filed and applied for trademarks in Classes 35 and 36. 

• June 25th, 2024: Zap Africa filed and applied for the trademark in Class 42. 

• March 27th, 2025: Zap Africa filed and applied for the trademark in Class 36. 

Let’s break it down:

• Class 35 covers Advertising Business Management, Business Administration and Office Functions.

• Class 36 covers Insurance, Financial Affairs, Monetary Affairs and Estate Affairs – aka the coveted class for the purpose of this trademark war.

• Class 42 covers Computer Hardware and Software.

Big Tech This Week contacted a source at the Ministry of Trade & Investment to confirm which company owns the Zap trademark across the contested classes and why two companies have trademark documents showing they own the ‘ZAP’ trademark in Classes 35 & 36. 

We did not hear back when we published this article, but we will update the story when we do.

Cease & Desist

In documents seen by Big Tech This Week, Zap Africa and Paystack have since sent each other cease and desist letters. 

Paystack sent Zap Africa a cease and desist letter on March 28th, 2025, accusing Zap of sponsoring and aiding the circulation of false statements accusing them of the unauthorised imitation of the name ‘Zap’. 

Paystack demanded that Zap Africa “immediately produce evidence of any pending or registered trademark applications for ‘Zap’ in Classes 9 and 36, among other demands. 

Zap Africa responded to Paystack by sending evidence of its ownership of ‘Zap’ with the trademark file numbers, insisting that Paystack infringed on its trademark.

Zap Africa stated, “ZAP has been in continuous use as their brand name since April 2023, rendering Paystack’s unauthorised and unlawful use of the mark as passing off”.

The startup demanded that Paystack cease using ‘ZAP’ in connection with any products or services and withdraw any product or marketing materials bearing ‘ZAP’ from app stores and online platforms. 

Interestingly, Paystack has not promoted Zap on its social media platforms since March 24th, the day the product was launched. In turn, Zap Africa has been aggressively promoting its product Zap across social media.

In response, Paystack says, “We’ve been focused on serving our first cohort of users. The attention we received was pleasantly overwhelming, and we’ve been working hard to ensure that this initial group is well taken care of before our next push”.

Big Tech This Week asked Zap Africa’s CEO, Asu-Johnson, if the company’s cease and desist letter to Paystack had anything to do with Paystack ceasing promotion of the Zap. He replied that he wasn’t aware of Paystack’s internal decisions, but his company was patiently waiting for the law to take its course.

The verdict

As Nigeria’s fintech sector matures, the Zap squabble offers a timely parable – even the continent’s most celebrated startups are not immune from the regulatory web they helped build. If anything, they are expected to lead by example.

In trying to own a word, Paystack may have opened a much larger conversation about power, compliance, and the future of African fintech.

In retrospect, it begs the question of whether Paystack wished they had chosen a different name from the start to avoid this aftermath. 

But in fintech, there are no shortcuts — only receipts.