Frontier Fintech GPS #28 - April 16th 2025
Stitch raises a US$ 55m round, AfDB President calls for friendlier credit policies towards SMEs, Fairmoney sees 62% rise in revenues and other stories that matter
Illustration by Mary Mogoi
Hi All, Welcome to the 28th edition of Frontier Fintech GPS where I provide key insights on the top global Fintech news items that matter to you. This newsletter will be arriving in your inboxes every Wednesday morning. The idea behind Frontier Fintech GPS is to help you navigate the endless stream of Fintech news and get smart about global Fintech as it applies to Africa. To those who are yet to subscribe, hit the subscribe button below and share with your colleagues and friends. 🚀
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🇿🇦 South Africa’s Stitch Raises $55M to Scale Embedded Payments and Acquiring
South African fintech Stitch has raised $55 million in a Series B funding round led by QED Investors, with participation from Raba Partnership ($4.2M), PayPal Ventures, and others, bringing its total funding to over $100 million. The Cape Town-based company, founded in 2019, provides a unified payment platform enabling businesses to manage online and in-person transactions seamlessly across South Africa. With recent moves like acquiring ExiPay for in-person payments and partnering with Standard Bank’s Shyft, Stitch plans to expand its enterprise-focused solutions, including acquiring services and payouts, to capitalize on S. Africa’s growing digital payments market despite regulatory complexities.
Stitch has really zeroed in on Enterprise payments and combined customer-centricity and technological prowess to deliver value to large enterprises in SA. The digital payments market is estimated to be in excess of US$ 30 billion and moreover, South Africa is witnessing an evolution in payments from cash to alternatives such as virtual cards, pay by bank and BNPL. Stitch enables all these across its payments products with the added value of better treasury management, visibility and fraud rates. In an up-coming episode with Kiaan on the F-Squared podcast, you will get a peak into not only Stitch’s evolution, but its approach to serving enterprise clients, doing enterprise sales and importantly, their view on the ever evolving South African payments market. For Kiaan, he believes that there’s a lot of value to be derived by going deep into enterprises in SA.
🇳🇬 AfDB President Criticizes Nigerian Banking System for Failing Young Entrepreneurs
Akinwumi Adesina, President of the African Development Bank (AfDB), has strongly criticized Nigeria’s commercial banks for their failure to support young entrepreneurs, stating the banking system is not designed to meet their needs. Speaking on Channels TV, Adesina highlighted how banks prioritize risk over potential, demanding unrealistic collateral like property or extensive tax records from young applicants, stifling innovation. He linked this systemic exclusion to the “japa syndrome,” where youth emigrate for better opportunities, and called for banks to invest capital in young people’s ideas rather than offering token empowerment programs, emphasizing that Africa’s 460 million youths need financial backing to transform their demographic advantage into economic success.
It’s easy to bash banks and particularly their approach to lending to small businesses. Ultimately, one must recognise that improving access to funding for young businesses and individuals requires a holistic approach. For instance, banks have credit policies that are often approved by the regulator. These credit policies are designed to show the regulator that they are thorough in their risk assessment because ultimately, they need to prove that they won’t lose depositor funds carelessly. These policies for instance require audited financials, tax returns and collateral. For a credit sanctioner, even if a deal looks good, going against the policy despite the circumstances could lead to them losing their jobs. Improving access to SME finance requires change all the way from the apex banks and the types of credit policies that the regulator promotes. Banks can lend, they just need to be allowed to.
🇳🇬 FairMoney's Revenue Soars to ₦121.9B in 2024
FairMoney, a Nigerian consumer-focused lending fintech, saw revenue climb 62% to ₦121.9 billion ($73.3 million, at ₦1,663/$1) in 2024, with profit after tax rising to ₦7.9 billion ($4.75 million) from ₦780 million ($469,000) in 2023, fuelled by deposit-funded lending. Customer deposits surged from ₦2.9 billion ($1.74 million) in 2021 to ₦72.9 billion ($43.84 million), covering over 55% of its loan book, while borrowings dropped below 10%. Loan interest revenue grew 57% to ₦116 billion ($69.75 million), but impairments rose 30% to ₦59.4 billion ($35.72 million) after stabilizing at ₦45 billion, driven by FairMoney’s conservative IFRS 9 approach of provisioning loans as impaired until repaid, pushing the impairment ratio to 45.7% of its ₦129.9 billion ($78.11 million) loan book. Operating costs reached ₦41 billion ($24.66 million), with a net interest margin of 81.7% reflecting high-yield loans but elevated credit risks.
This article is in someway related to the last. Companies like Fairmoney are taking advantage of the often rigid credit practices by larger banks in the Nigerian lending market. Fairmoney’s results show that their move towards accessing deposits which now account for over 50% of their loan book is leading towards better financial results. Nonetheless, 47% impairments, 81.7% net-interest margins and over 120% APR shows that Fairmoney is playing at the edge of maximising returns and risky lending. Usually, as rates go higher, you tend to attract riskier borrowers who may have no intention to repay. From the outside looking in, Fairmoney may need to further recalibrate its models and customer profile so that it can profitably lend at much lower APRs. The challenge for now is that the policy rate in Nigeria is 27.5% and therefore a lender like Fairmoney has little wiggle room in its cost of funds and therefore ultimate APR to clients.
🇹🇿 Ramani Expands Partnership with Tanzania Commercial Bank to Boost SMB Financing
Ramani, a Y Combinator-backed Tanzanian fintech, has partnered with Tanzania Commercial Bank (TCB) to expand its Financial Marketplace, launched in June 2023, to enhance credit access for small and medium-sized businesses (SMBs). Following Stanbic Bank’s involvement, TCB’s entry enables SMBs in sectors like FMCG to secure scalable loans with lower fees, addressing the 50% credit access barrier cited by Tanzanian businesses (World Bank, 2024). The platform, which has facilitated over $210 million in loans with 136% monthly growth, streamlines lending processes digitally, supporting Ramani’s shift to a B2B e-commerce platform by mid-2025. Their average loan size is US$ 47,000 meaning they’re doing meaningful enterprise lending in the market.
Ramani has executed against an often-cited but rarely well done model, leveraging B2B digital supply chain data and workflows to enable embedded lending. Their US$ 47,000 average ticket size speaks to what would be expected in terms of average order sizes in the market. In a country where Private Sector Credit to GDP stands at 17% compared to Kenya with 32% and South Africa with over 90%, such models are critical to enable SME credit access. In Nigeria, OmniBiz is driving the same outcomes albeit their model is way more comprehensive. Potentially Kenyan Banks in Tanzania can work with Ramani to grow their loan books.
🇪🇬 e& Egypt Launches Instant Global Transfer Service via e& Cash Wallet
e& Egypt has launched the country’s first instant international money transfer service through its e& Cash digital wallet, enabling users to receive funds from the UAE and Saudi Arabia instantly and securely without visiting branches. Developed with Banque du Caire, the service leverages e&’s regional network to streamline cross-border remittances, aligning with the Central Bank of Egypt’s push for financial inclusion and reduced cash reliance. With over 52 million Egyptians now holding transactional accounts, the service supports Egypt’s digital transformation, offering a fully digital experience and plans to expand to more countries soon
I wrote sometime back about selecting Fintech markets in Africa. For Egypt, the conclusion was that there is an app not only for digital wallets, but also for cross-border payments given their capital controls. e& is riding on these two factors, demand for digital stores of value and easy cross-border payments to launch a wallet-based remittance service. Given that Egyptian workers form a large part of the workforce in the gulf, there is significant captive demand for such a product.
🇳🇬 UBA Enhances Digital Payment Solutions with Upgraded PoS Terminal and MONI App
United Bank for Africa (UBA) has launched an enhanced Point of Sale (PoS) terminal and UBA MONI App to streamline digital payments and empower small and medium enterprises across Africa. The upgraded PoS offers instant settlements, real-time transaction monitoring, pay-by-link functionality, and a 100% success rate, while the MONI App includes features like pay-by-transfer, enhanced security, and a redesigned interface for agents. Aimed at improving efficiency and trust, these innovations support UBA’s campaign to simplify banking and connect communities, catering to businesses of all sizes in Nigeria’s fast-paced economy.
UBA is joining GT Bank in the scramble for SMEs in Nigeria. Earlier trailblazers like Opay, PalmPay and Moniepoint validated the model of building out merchants and agents via POS machines whilst enabling clients to transact on a mobile app. In a market with close to 200m people and less than 4 branches per 100,000 people, this model makes sense particularly in the absence of real Mobile Money. For GT and UBA, the challenge is that the trailblazers are all very formidable opponents and apart from PalmPay, are all unicorns. There’s an innovation stack element at play. The banks may leverage their existing branch networks to handle merchant/agent management and acquisition whilst also driving price based competition through lower tariffs. Nonetheless, the real battle is in merchant management (training, recruitment and overall customer service), platform reliability (Transaction success rates) and value added services such as how easy it is to get working capital finance. GT and UBA don’t have any unique advantages here and their competitors have already built their icebergs.
🇬🇧 UK: J.P. Morgan's Kinexys Launches GBP Blockchain Deposit Accounts
Kinexys, J.P. Morgan’s blockchain unit, has launched GBP-denominated blockchain deposit accounts at its Chase Bank London branch, enabling 24/7 real-time cross-border payments and foreign exchange (FX) transactions. Clients like SwapAgent (LSEG’s post-trade business) and Trafigura can now access funds on demand, process transactions over weekends, and settle FX same-day, building on Kinexys’ prior EUR accounts in Frankfurt. With over $1.5 trillion processed since 2019 and $2 billion in daily transactions, this move enhances flexibility and efficiency for corporate clients, supporting seamless global financial operations across USD, EUR, and GBP.
This story validates an emerging view I’m having i.e. incumbents are well placed to win in the crypto-based enterprise cross-border payments space. Where immediate settlement is a value add, Stablecoins and Blockchain based payments are an extra rail. Just like how a bank can use SWIFT or EAPSS to make a regional payment. Banks will simply integrate these additional payment options. Where their value will shine is that they have the client base, have built trust over the years, have built robust fraud infrastructure and importantly, can layer credit which is critical for B2B payments.
🇳🇬 OPay’s Valuation Rises to $2.75 Billion Despite Slower Growth
New filings from Opera Limited reveal that OPay, the Nigerian fintech giant, is now valued at $2.75 billion, up from $2 billion in 2021. Opera, a 9.4% minority stakeholder, disclosed that its stake in OPay was worth $258.3 million in 2024, compared to $253.3 million the previous year.
However, the unrealized fair value gain on Opera’s books dropped from $89.8 million in 2023 to just $5 million in 2024, suggesting that while valuation is up, growth has slowed significantly. Despite global fintech headwinds and tighter venture funding, OPay’s ability to hold and grow its valuation signals continued investor confidence. OPay operates in payments, credit, and insurance, reportedly serving 50 million users across multiple African countries. The company’s scale and diversification appear to be key drivers of its sustained valuation strength.
Despite the funding winter, Nigeria is a promising market for Fintechs. Digital transaction values continue to grow given government initiatives as well as the market getting more and more comfortable with digital payments. OPay shines in this regard due to its reliability and often easy to use app. Moreover, it has spent significant resources in marketing ensuring it has top of mind amongst its target demographics.
🇳🇬 Nigeria’s SEC Delays Crypto Licences Due to Due Diligence
Nigeria’s Securities and Exchange Commission (SEC) has postponed issuing new provisional crypto licences under its Accelerated Regulatory Incubation Programme (ARIP), citing the need for enhanced due diligence, as announced by Director General Emomotimi Agama during a FinTech Association of Nigeria virtual event. Following the Investment and Securities Act (2025), which classifies cryptocurrencies as securities, the SEC is coordinating with agencies like the Economic and Financial Crimes Commission (EFCC) and Nigerian Financial Intelligence Unit (NFIU), causing delays. Only Quidax and Busha received licences in August 2024, leaving numerous startups in limbo despite the SEC’s December 2024 pledge to fast-track approvals.
I’ve always argued that there are a few grey spots with the overall crypto regulatory environment in Africa. Most licensing is being done with a view of Crypto companies offering crypto trading services with the underlying Crypto being treated as digital assets. Nonetheless, outside of South Africa the most traded Cryptocurrency is actually Tether which is supporting cross-border payments. I suspect this could be one of the things holding back licensing in Nigeria specifically if the EFCC and NFIU are involved. The industry would be well placed to jointly draft a whitepaper that outlines Crypto’s role in cross-border payments and how regulators can maintain their safeguards under this new dynamic.
🇳🇬 x 🇰🇪 Access Bank Gains Approval to Acquire National Bank of Kenya
Access Bank, a subsidiary of Nigeria’s Access Holdings PLC, has secured final approvals from the Central Bank of Kenya (CBK) and Kenya’s National Treasury on April 4 and April 10, 2025, respectively, to acquire 100% of the National Bank of Kenya (NBK) from KCB Group PLC. Announced in March 2024, the deal, valued at approximately $100 million based on NBK’s 2023 book value, includes transferring certain NBK assets and liabilities to KCB Bank Kenya Limited. This acquisition, Access Bank’s second in Kenya after Transnational Bank in 2019, aims to expand its East African footprint and leverage regional trade growth, aligning with its goal to double assets outside Nigeria by 2027.
AccessBank over the years has really expanded its footprint across Africa. With its acquisition of NBK, it becomes a solid tier 2 bank in the market. For Context, National Bank of Kenya was formerly a government owned bank and through this has one of the most impressive branch networks in terms of strategic location be it at the port, at key government districts or offices. Moreover, it has very good Parastatal accounts such as the Kenya Ports Authority. The issue with National Bank particularly prior to KCB’s custody has been mismanagement. This has led to excessive defaults and subsequently an eroded capital base. Access Bank will have to recapitalise this and probably these recapitalisation plans could explain the delay in the deal being sanctioned. Going forward, Access Bank is able to offer its clients world class payments options both within Africa and globally. I expect them to be an interesting bank for Trade and SCF as well as being a partner of choice for the Fintech industry.