MFS Africa has announced 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 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.
MFS Africa’s presence in Nigeria to date has been limited given the country’s small number of mobile wallets. With the acquisition, MFS Africa will expand its pan-African network into Nigeria, connecting Nigerian businesses to the continent and the rest of the world.
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, MFS Africa will build Baxi into a key node on its digital payment network, allowing customers to make regional and global payments to and from Nigeria. MFS Africa will also expand Baxi’s proposition for offline SMEs to select markets within MFS Africa’s footprint of 320 million mobile wallets across more than 35 African countries.
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.
The focus areas of both companies are complementary. Baxi simplifies and integrates online and offline payments for SMEs and merchants in Nigeria through its omnichannel distribution network. MFS Africa simplifies cross-border payments, integrating payments via one hub.
Following the acquisition of Beyonic in 2020, MFS Africa continues to accelerate and lift its growth with strategic investment and acquisition, which are actively supported by its shareholders.