MFS acquires Baxi, set to expand into Nigerian markets

MFS Africa, the largest pan-African digital payments hub, has announced today that it had signed an agreement to acquire Baxi, one of Nigeria's leading super-agent networks. Subject to approval of the Central Bank of Nigeria, the deal 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 restricted 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.

"We aim to take Nigeria’s SMEs to the rest of Africa and the world."

“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.

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.

This year, through its network of more than 90,000 agents, Baxi has already processed over USD 1 Billion in transactions. 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 widen 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 omni-channel distribution network. MFS Africa simplifies cross-border payments, integrating payments via one hub.

“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.

Following the acquisition of Beyonic in 2020, MFS Africa continues to accelerate and lift its growth with strategic investment and acquisition, which are supported by its shareholders. LUN Partners and FT Partners served as financial and strategic advisors to MFS Africa in this transaction.

PWC Nigeria and Nihilent advised MFS Africa on Commercial, Product and Technological due diligence. Da Hui and TNP were legal advisors to MFS Africa. 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.

About MFS Africa

MFS Africa, believes that making a payment should be as easy as making a phone call. Access is the currency with which Africans can overcome barriers and injustice and render borders insignificant.

They give partners access to a borderless world of opportunities, connecting enterprises, banks, mobile money operators, and money transfer companies to each other and to over 320 million mobile money wallets in over 35 African countries.

MFS Africa’s infrastructure enables disbursements and collections, and connects partners to our network footprint of MNOs, Banks and Cash Pickups through her API or Business portal Portal, Beyonic.

In addition to mobile remittance services, they enable merchant payment, bulk payment, bank-to-wallet transfers, and an array of other cross border and domestic digital payments services.

MFS Africa works in close partnership with players across the ecosystem to bring simple and secure mobile financial services to un- and under-banked customers. For millions of people on the continent and beyond, we make borders matter less.

About Baxi

Baxi is one of the largest independent non-bank SME focused electronic payment networks in Nigeria operating an Omnichannel platform that enables digital payment through mobile, in-store location, online, wallets and b2b channels.

Her mission is to bring a wide bouquet of digital products and services to the grass root and mass-market consumers through innovation, technology and a world-class retail distribution network that is driven primarily by agents and merchants.

Their vision is to have a retail presence on every street and a digital presence in every household in Nigeria by creating a one-stop-shop for accessing a broad range of products and services, they are not only simplifying the buying experience for their end consumers but also creating a powerful tool for her agents.

Baxi is the closest and most friendly touchpoint to the mass-market consumers. Her active agent spread across the country helps to drive the efficient and effective delivery of products/services thereby reducing time to market.