MFS Africa‘s mission to colonize Africa’s fintech ecosystem continues. Barely some months after entering Cameroon via Maviance and after announcing a partnership deal with Global Technology Partners (GTP) to supply 100 million mobile money cards to mobile money users across Africa, the company has finally entered Nigeria through an agreement to acquire Baxi, one of Nigeria’s leading super-agent networks.
“We’re thrilled to partner with the MFS Africa team to expand our service offering for individuals and SMEs. We believe that we’ve barely scratched the market’s potential. Only 3% of Nigerian SMEs have access to credit products. By teaming up with MFS Africa, and with the strong support of our local commercial banking partners, we can offer more value-added products and services, such as cross-border payments, to support Nigerian SMEs in their growth,” said Degbola Abudu, Baxi CEO.
The deal, which is still awaiting approval from Nigeria’s Central Bank, will be the country’s second-largest fintech acquisition to date.
Why The Acquisition?
Baxi is one of Nigeria’s largest independent SME-focused electronic payment networks, founded in 2014 by Degbola Abudu and Folu Majekodunmi. To the last mile, Baxi offers a cash-in/cash-out service as well as value-added services such as account opening, money transfer, bill payment, and more. Baxi has already processed over USD 1 billion in transactions this year through its network of over 90,000 agents.
MFS Africa would turn Baxi into a significant node on its digital payment network after the deal closes, allowing clients to make regional and worldwide payments to and from Nigeria.
MFS Africa will also expand Baxi’s offline SMEs offering to a select number of markets within MFS Africa’s 320 million mobile wallets presence across more than 35 African countries.
“This deal is a pivotal step in our journey. By combining Baxi’s network of SMEs operating as agents with our pan-African network, we aim to take Nigeria’s SMEs to the rest of Africa and the world. Our expansion into Nigeria brings us one step closer in our mission of making borders matter less,” said Dare Okoudjou, MFS Africa Founder and CEO.
Nigeria is one of the continent’s most dynamic markets; it is Africa’s largest economy and home to the continent’s highest number of SMEs. It is also Africa’s largest remittance market, accounting for one-third of all intra-Africa remittances. Due to the country’s tiny number of mobile wallets, MFS Africa’s footprint in Nigeria has been restricted thus far. MFS Africa will expand its pan-African network into Nigeria as a result of the acquisition, connecting Nigerian businesses to the continent and the rest of the world.
The sector’s expansion in Nigeria has been hindered by previous prohibitions on mobile network operators’ participation in mobile money services. Nigerian fintechs that have created robust agent networks are the critical interface to reach Nigeria’s 31 million financially underserved and 67 million financially unserved people, which account for more than 55 percent of the country’s population. Supporting and growing SMEs is critical for Nigeria’s economy, as they account for half of the country’s GDP and create 76% of jobs[i]. Baxi addresses a vital gap by giving unbanked Nigerians and informal SMEs with access to financial services through its presence in 36 Nigerian states.
Both companies’ focus areas are complementary. Baxi’s omni-channel distribution network streamlines and unifies online and offline payments for SMEs and merchants in Nigeria. MFS Africa streamlines cross-border payments by combining them into a single hub.
MFS Africa continues to accelerate and raise its growth via strategic investment and acquisitions, which are backed by its shareholders, including the acquisition of Beyonic in 2020.
MFS Africa Baxi Nigeria MFS Africa Baxi Nigeria
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer