MFS Africa on Thursday (Oct. 21) announced it has signed an agreement to acquire Nigerian digital solutions and distribution company Capricorn Digital, the parent company of Baxi, for an undisclosed amount, according to a Technext report.
Baxi gives its users access to products that solve everyday payment needs, including utility bill payments, airtime purchases, data subscriptions, withdrawals and money transfers.
Capricorn Founder and CEO Degbola Abudu told Techcabal the MFS Africa acquisition, which is subject to approval from the Central Bank of Nigeria, will be the second-highest FinTech deal in Nigeria, behind only the $200 million Stripe paid for Paystack last year.
“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,” he said. “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 Abudu.
Capricorn Digital will add to its staff of more than 90,000 agents across Nigeria with the deal. MFS Africa, founded in 2009 by Beninese national Dare Okoudjou, is the largest FinTech interoperability hub in Africa, with connections to about 320 million customers in more than 35 African countries.
Baxi has processed more than $1 billion in transactions this year through four product offerings that serve as an online ecosystem of payments services.
MFS Africa will work with Nigeria’s central bank and other regulators to get the licenses needed to operate its remittance, micro-lending and insurance services and try to develop commercial partnerships in the country.
In March, MFS Africa announced that it has reached more than 320 million mobile money wallets, giving the Pan-African FinTech leader coverage across 60 percent of all such wallets in sub-Saharan Africa.
That reach — based on the 2021 Mobile Money State of the Industry Report from the GSMA — gives a range of “banks, telcos, money transfer operations and other financial institutions interoperability at scale in Africa through a single integration point,” according to a company announcement at the time.