MFS Africa announces expansion into Nigeria

Onafriq Announces Acquisition of Baxi in Nigeria

LAGOS, Nigeria 20 October 2021: Onafriq, the largest pan-African digital payments hub, announced today that it had signed an agreement to acquire Baxi, one of Nigeria's leading super-agent networks. The deal, which is subject to approval from the Central Bank of Nigeria, will be the second highest fintech acquisition in Nigeria to date.

Nigeria: A Key Market in Africa’s Digital Payments Landscape

Nigeria is home to one of the most dynamic markets on the continent; it is Africa's largest economy and home to the largest number of SMEs. It is also the largest remittance market in Africa and home to one-third of intra-Africa remittance flows. Onafriq’s presence in Nigeria to date has been limited given the country’s small number of mobile wallets. With the acquisition, Onafriq will expand its pan-African network into Nigeria, connecting Nigerian businesses to the continent and the rest of the world.

A Pivotal Step Towards Supporting Nigerian SMEs

“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, Onafriq Founder and CEO.

About Baxi: Connecting Nigeria’s Unbanked and Informal SMEs

Founded in 2014 by Degbola Abudu and Folu Majekodunmi, Baxi is one of Nigeria’s largest independent SME-focused electronic payment networks. Baxi provides a cash-in/cash-out offering as well as value-added services — account opening, money transfer, bill payment and more — to the last mile. Through its network of more than 90,000 agents, Baxi has already processed over USD 1 Billion in transactions this year. Following the acquisition’s close, Onafriq will build Baxi into a key node on its digital payment network, allowing customers to make regional and global payments to and from Nigeria. Onafriq will also expand Baxi’s proposition for offline SMEs to select markets within Onafriq’s footprint of 320 million mobile wallets across more than 35 African countries.

Filling the Gap in Nigeria’s Financial Services Market

Previous restrictions to mobile network operators’ participation in mobile money services have restrained the sector's growth in Nigeria. To serve the more than 55% of Nigerian consumers currently excluded from formal financial services, Nigerian fintechs that have built strong agent networks are the crucial interface to reach Nigeria’s ~31m financially underserved and ~67m financially unserved populations. Supporting and nurturing SMEs is crucial to Nigeria’s economy, as they contribute 50% of Gross Domestic Product and provide 76% of jobs. With its presence in 36 Nigerian states, Baxi fills a critical gap by providing unbanked Nigerians and informal SMEs access to financial services.

Complementary Focus Areas: SMEs and Cross-Border Payments

The focus areas of both companies are complementary. Baxi simplifies and integrates online and offline payments for SMEs and merchants in Nigeria through its omni-channel distribution network. Onafriq simplifies cross-border payments, integrating payments via one hub.

A Strategic Partnership for Nigerian SMEs’ Growth

“We’re thrilled to partner with the Onafriq 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 Onafriq, 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.

Accelerating Growth with Strategic Acquisitions

Following the acquisition of Beyonic in 2020, Onafriq continues to accelerate and lift its growth with strategic investment and acquisition, which are actively supported by its shareholders. LUN Partners Financial and FT Partners served as financial and strategic advisors to Onafriq in this transaction. PWC Nigeria and Nihilent advised Onafriq on Commercial, Product and Technological due diligence. Da Hui and TNP were legal advisors to Onafriq. Baxi was advised by financial advisor Verdant Capital and DAI Magister. Their legal counsels were Udo Udoma & Bello-Osagie (UUBO) in Nigeria and Akin Gump Strauss Hauer & Feld LLP in London.