This startup believes replacing account numbers with paytags can reduce fraud in Nigeria’s banking system
One of the main focuses of digital payments in Nigeria has been speed and accessibility.
One of the main focuses of digital payments in Nigeria has been speed and accessibility. Fintechs and banks are concerned with how instant transfers happen, how quickly people are onboarded, and how easily payments work across platforms.
While being able to move money in seconds is a feat of engineering worth celebrating, the increased speed of our transactions has also increased our vulnerability. In recent years, there’s been a surge in digital fraud and banking privacy issues.
To process payments or make a business transaction, you provide an account number. In that single act, you often share your full name, your bank, and a potential trail of your habits. With fintechs where the bank accounts are sometimes their personal numbers, the risk is higher.
In a recent conversation with the founder of Flex, a Nigerian fintech, Chika Okere argued that one of the biggest weaknesses in Nigeria’s payment ecosystem is not necessarily the transfer infrastructure itself, but the amount of personal information attached to every transaction.
According to him, fraud rarely starts with one major breach. It starts with fragments: a name here, a phone number there, an account number shared during a transfer, or a leaked BVN somewhere else. Over time, those fragments become enough to impersonate people, manipulate banking systems, or execute social engineering attacks.
“What hackers target is information that makes sense,” he said. “Nobody has all your information at once. They collect it gradually.”
This is what led Flex to build pay tags — unique identifiers that allow users to send and receive money without exposing their account numbers.
The idea itself is not entirely new. Usernames and tags have existed across payment systems globally for years. Nigeria has also seen similar attempts before. However, fraud in Nigeria’s financial ecosystem has become harder to ignore.
Banks are tightening verification systems, regulators are increasing compliance requirements, and fintechs are layering more identity checks into onboarding. Consumers are also becoming more aware of how vulnerable their personal information can be once it starts circulating across platforms. What Flex’s introduction of paytags attempts to do is introduce a layer between identity and transactions.
For most people, sharing their account details has become normal. For Okere, it became the reason to build a fintech startup.
“I asked for a parking attendant’s account number once because I didn’t have cash,” he shared. “The next time I came back, he called me by my middle name, and I never use that name publicly.”
At that moment, according to him, it forced a bigger question: Why does sending money in Nigeria require exposing personal information at all?
Now, Flex is trying to build an alternative.
The solution being proposed by Flex isn’t to replace the banking system but to mask it. By using a pay tag (a pseudonym or a unique identifier), you create a firewall between your money and your identity.
It’s a closed-loop logic that handles the heavy lifting of settlements in the background while keeping the user’s sensitive details invisible. Imagine sending money from an OPay wallet to a Zenith Bank account without either party ever seeing a 10-digit account number. You’re only seeing the tag.
This moves us closer to the models we see with Zelle or Cash App, where the identity is the transaction point, not the bank vault. The logic behind this approach also mirrors what has already happened in other parts of the Internet.
Social platforms moved away from publicly exposing personal contact information. Ride-hailing apps stopped displaying direct numbers without masking systems, and eCommerce platforms introduced intermediary communication layers between buyers and sellers. Payments may simply be arriving at a similar point where users no longer want raw banking details constantly exposed during ordinary transactions.
The big question, however, is, does this really stop a determined fraudster? Does masking account numbers meaningfully reduce fraud in a country where personal information is already widely accessible through social media, leaks, telecom databases, and poor data protection practices?
The short answer is that it makes their job exponentially harder. In a verified tag system, you aren’t just a number; you are a KYC-verified identity linked to BVN and NIN. If money moves into a closed ecosystem, it becomes much harder to move out untraceably.
Fraud often depends on connecting multiple pieces of information together. In Okere’s view, account numbers are one of the strongest connectors in that chain because they directly tie individuals to financial systems. Remove that layer from everyday exposure, and assembling full identity profiles becomes harder.
Whether that argument fully holds up at scale is still unclear. But it shows that payments are no longer only about the movement of money; identity is becoming part of the infrastructure itself.
For years, the dominant model in Nigeria’s fintech ecosystem has been interoperability. Recent conversations around open banking have also centred around sharing financial data securely between institutions, and fintech growth has depended heavily on interconnected systems. But alongside that openness is a growing desire for more controlled environments where users feel safer.
Flex operates as a closed-loop payment environment, one where money moves internally between verified users without repeatedly exposing sensitive details. The company believes that reducing exposure points, tightening verification, and limiting how funds move across systems could significantly reduce fraud risks.
That thinking aligns with a broader trend already visible globally. Wallet ecosystems are becoming increasingly important; companies increasingly want users to transact, store value, and interact within contained financial environments rather than constantly moving across fragmented banking rails.
The company says its long-term vision is larger than its own app. It wants banks and fintechs to plug into the paytag network so customers across different financial institutions can transact without revealing account numbers.
The founder described Flex less as a traditional fintech app and more as a closed-loop financial ecosystem.
His analogy is simple: if four people are inside a room passing ₦1,000 between themselves, the money technically never leaves the room. In the same way, he argues, money moving inside Flex’s ecosystem can move faster and cheaper because settlement complexity is reduced.
That closed-loop structure is central to how Flex plans to offer free peer-to-peer transfers.
“Nigerians need a break,” he said while discussing transfer charges and VAT deductions attached to digital payments.
