African fintech Startup MFS Africa Buys US Firm Global Technology Partners, Expands To US
MFS Africa, a digital payments company, is acquiring Global Technology Partners of Oklahoma in what it describes as an unusual occurrence of an African group completing a technology purchase in the US. The acquisition, which would allow MFS to offer prepaid cards to clients, is another step forward in Africa’s fast expanding financial landscape. Hundreds of millions of Africans without bank accounts keep their money on their phones or in digital mobile wallets. However, many multinational companies, including Netflix and Amazon, do not accept digital money transfers from Africa, according to Dare Okoudjou, founder and CEO of MFS, who stated that the partnership with GTP would address this issue.
“It’s mostly for international ecommerce platforms, which are not able or willing to create the user experience that will accept mobile,” he said.
He noted that MFS had recently struck a contract with Spotify under which the streaming service would take mobile payments from clients in Kenya, Uganda, and South Africa.
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“There is more pent-up demand for things like Netflix on the continent than people think.”
The GTP acquisition follows a partnership announced earlier this month between Kenya’s Safaricom, the pioneer of mobile money and a Vodacom subsidiary, and Visa. Users of Safaricom’s M-Pesa mobile money will be able to receive virtual credit cards as a result.
MFS Africa has diversified significantly through acquisition, including the purchase of Baxi, a Nigerian digital payments business, for an undisclosed sum last October.
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Robert Merrick, founder and chair of GTP, said: “MFS Africa is an ideal home for GTP, and we are focused on adding new features and functionalities to our platform . . . and making a significant contribution to growing MFS Africa’s business.”
GTP serves customers in 34 countries and collaborates with 80 banks, including UBA, Ecobank, Stanbic, and Zenith. According to Okoudjou of MFS Africa, GTP prepaid cards are being utilized by approximately 500,000 clients, but the potential market size is many times that number. In Africa, he estimates that 400 million people utilize mobile money.
Okoudjou went on to say that MFS paid $34 million for GTP in cash and shares, and that the acquisition will help MFS grow its operations in the United States.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard. You can book a session and speak with him using the link: https://insightsbyexperts.com/view_expert/charles-rapulu-udoh
