Africa’s largest digital payments hub, MSF Africa, has acquired one of Nigeria’s biggest digital solutions companies, Capricon Digital, in what is rumoured to be the second-largest fintech acquisition in the country.
Capricon Digital, which was founded in 2014 by Dee Abudu and Folu Majekodunmi, has a network of 90,000 agents scattered across the country and operating an ecosystem of digital payments services under its core product, Baxi.
Baxi focuses on helping Nigerians with daily payment services like money transfers and withdrawals, utility bill payments, airtime and data purchases, etc. All of these services are delivered through its wide network of agents located in nearly every corner of the country.
While the financial details of the deal are yet to be disclosed by both companies, this acquisition by MFS Africa is believed to be one of the biggest in the country’s fintech sector, exceeded only by Stripe’s $200 million acquisition of Paystack last year.
This deal, which is MSF Africa’s third acquisition in just five years, will ensure the digital payment company further expands and carves a space for itself in the Nigerian financial space.
Founded in 2009 by Benin-born Dare Okoudjou, MSF Africa links telecom providers, and money transfer operators across 35 countries through a single API. Notable operators like Safaricom, and Paga are integrated operators of MSF Africa’s software, with about 320 million customers transacting across all the digital wallets for free.
The company’s vision is to expand into every country on the continent, serving millions of people and small businesses. In a conversation with a reporter at TechCabal, Okoudjou shares his goal of making online monetary transactions easier for Africans. “If you have a phone or POS, it should be enough to transact with the rest of Africa and the world,” he says. “We’re building the foremost, currency-agnostic, real-time hub for payments on the continent, to enable people to transfer money the way they can call each other.”
This acquisition will give rise to a bigger, and more dynamic company that combines integration between operators and a wide network of money agents to reach millions of Nigerians. While Capricorn will adopt the MFS Africa name henceforth, its product Baxi will maintain its name as MFS Africa intends to raise it into a key feature on its payment network.
On why Capricorn accepted the deal, Co-Founder Abudu says that they believe consolidation is the only way to achieve the desired goal for advanced mobile payments in Africa.
“It’s a good time to partner with a company that brings a real pan-African presence and we see synergies across our operations. They offer a wide range of value-added products and services like cross-border payments while we have access to SMEs in Nigeria, one of the biggest markets in Africa,” he says. “We’ve been able to build a large business with relatively small capital but now we want to be able to compete, not just in Nigeria but also across Africa.”
MFS Africa plans to engage with the CBN and other regulators to acquire any additional licenses needed to fully deploy its services in the country.