Frontier Fintech GPS# 35 - June 4th 2025
Moniepoint finally acquires Kenyan MFB, South African Court creates new headaches for Crypto Regulators, Fincra secures Tanzanian PSP license and other stories that matter
Illustration by Mary Mogoi
Hi All, Welcome to the 35th 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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🇰🇪 | Moniepoint Acquires 78% of Sumac Microfinance Bank
The Competition Authority of Kenya (CAK) approved Moniepoint Inc.’s acquisition of a 78% stake in Sumac Microfinance Bank, enabling the Nigerian fintech’s entry into Kenya’s $67.3 billion mobile payments market. The deal, pending Central Bank of Kenya (CBK) approval, follows Moniepoint’s failed attempt to acquire KopoKopo in 2023. Sumac, with a 4.3% market share and 43,800 active loan accounts, offers Moniepoint a foothold in Kenya’s competitive financial sector. The acquisition aligns with fintechs’ strategy of buying licensed local players to bypass regulatory hurdles. CAK confirmed no job losses or negative competition impacts, supporting Moniepoint’s expansion into East Africa’s largest economy
This transaction was only a matter of time as it has been in the works for a while. It makes a ton of sense for Moniepoint to enter the market as an MFB because it rhymes with their license in Nigeria. Moreover, Kenya’s Microfinance license is very attractive when you compare it with Nigeria. A Microfinance Bank can participate in FX transactions in Kenya whereas in Nigeria there are restrictions here. Nonetheless, the bigger point is about market entry and target clientele. In Nigeria, Moniepoint effectively replaced cash through an agent and merchant network and has ridden the demonetisation wave expertly. In Kenya, cash competes with M-Pesa which is a behemoth. The payment use case may be limited and Moniepoint may look at a hybrid strategy leading with credit whilst also powering payments. I still think that Kopo Kopo was a good acquisition target in that regard, but it made sense to prioritise an MFB license.
🇿🇦 | South African Court Excludes Digital Assets from Forex Controls
The Pretoria High Court ruled on May 15, 2025, that digital assets, including Bitcoin, are not "capital" or "currency" under South Africa’s Exchange Control Regulations, following a dispute between Standard Bank and the South African Reserve Bank (SARB). SARB had seized over $1 million from Leo Cash & Carry (LCC), an insolvent firm, for transferring $37 million in Bitcoin abroad without authorization, alleging a breach of forex laws. Standard Bank argued that digital assets fall outside these regulations, and the court agreed, setting aside a R16.4 million forfeiture. This creates a loophole allowing unrestricted external transfers of digital assets, raising concerns about capital flight. Experts predict SARB will amend regulations within 12-18 months to address this gap, as it risks undermining South Africa’s exchange control system.
This is an interesting one. As Stablecoin usage explodes in Africa, the big elephant in the room has been regulation. This case in South Africa is illustrative for a number of reasons. As VASP licensing comes into play, some regulators are bunching stablecoins together with all other crypto assets and tagging them as digital assets. This case in SA has exposed the folly in such a strategy because digital assets would fall outside the ambit of capital controls thus spurring a shift towards stablecoins en masse in countries that have strict FX controls. SARB are likely to come back with regulations that at their core view stablecoins as currency either through Electronic Money Issuer licensing type regulations or a variant of payment licensing. The Stablecoin industry should take note of this as they lobby regulators.
🇹🇿 | Fincra Secures Payment System Provider Licence in Tanzania
Fincra, a Nigerian fintech, obtained a Payment System Provider licence from the Bank of Tanzania, enabling it to offer secure payment services like virtual accounts, payment APIs, and checkout solutions. The licence supports Tanzania’s Vision 2025 for financial inclusion, empowering SMEs with efficient payment tools. Tanzania’s mobile money transactions grew 26.73% to 6.41 billion in 2024, driven by mobile penetration and regulatory reforms. This marks Fincra’s third East African market, following Kenya and Uganda, and complements its South African TPPP licence. The move strengthens Fincra’s pan-African payment network, facilitating cross-border transactions and competing with local players like Vodacom’s M-Pesa.
When you look at African Fintech companies from the perspective of TPV per dollar raised, Fincra stands far and to the right on a league of its own. In the same week that they’ve announced a PSP license in Tanzania, they announced a Payments Provider license in South Africa. This shows a company that can balance both aggressive commercial growth and the delicate act of building solid relationships with regulators. I expect them to be a major player in African payments for years to come particularly as Stablecoins become mainstream.
🌍 | dLocal to Acquire AZA Finance in $150M Deal
Uruguay-based fintech dLocal, a cross-border payment platform, announced its intent to acquire AZA Finance, an African payments provider, for $150 million, pending regulatory approval. The deal expands dLocal’s presence in 17 African markets, including Botswana, Mozambique, and Guinea, where it previously had no operations. AZA Finance, founded in 2013, has processed over $9 billion in transactions across 15 million transfers. The acquisition enhances dLocal’s capabilities in remittances, treasury operations, and stablecoin coverage, integrating AZA’s expertise in forex and compliance. It follows a 2025 strategic partnership between the two firms, aiming to streamline cross-border payments and boost financial inclusion. This move strengthens dLocal’s competitive edge in Africa’s growing digital payments market.
This is an interesting one. My understanding is that dLocal has been using AZA as a partner for pay-outs in the continent. Moreover, I also understand that AZA has been struggling as it was caught up in the FTX cross-hairs. The logical thing here is that dLocal is acquiring AZA to continue benefitting from AZA’s infrastructure essentially moving from a partner to a subsidiary. If that’s the case, then the price-tag raises questions. Why would you buy a company that’s struggling for US$ 150m whilst you’re in effect just keeping it afloat for your own strategic reasons? The acquisition makes sense, the price tag doesn’t.
🇺🇸 | Trump Media Raises $2.5B to Establish Bitcoin Treasury
Trump Media and Technology Group, parent of Truth Social, raised $2.5 billion through stock and convertible bond sales to establish a Bitcoin treasury. The deal includes $1.5 billion in equity and $1 billion in 0% convertible notes, with net proceeds of $2.32 billion. The company aims to become a major Bitcoin holder among U.S. public firms, following strategies like MicroStrategy’s. The funds will also support general corporate purposes. This move diversifies Trump Media’s revenue streams and aligns with its pro-crypto stance, amid a supportive U.S. regulatory shift. It intensifies competition in the $3.5 trillion crypto market.
This story raises a number of red flags for the Crypto and Stablecoin ecosystem in large. This needs to be seen in the context of Cantor Fitzgerald’s activity be it teaming up with Tether or launching its own Bitcoin Fund. Cantor Fitzgerald is associated with Howard Lutnick who is the current Secretary of Commerce. It all seems dodgy to be honest. These are the kind of dealings we’d associate with an African country and not the leading financial centre of the world. Money is a serious business and when companies associated with both the president and his secretary of commerce are angling for a piece of the crypto pie that will be unlocked by legislation they control, it validates the cynicism that some people have towards the broader crypto ecosystem. In the long-term, it could defeat the entire story of stablecoins as drivers of global dollarisation.
🇪🇹 | Ethiopia Launches Biometric Fayda Wallet to Advance Financial Inclusion
Ethiopia introduced Fayda Wallet, a digital wallet linked to the national biometric ID, to simplify access to financial and administrative services, launched at the ID4Africa 2025 conference in Addis Ababa. Developed by the National ID Program (NIDP) with TECH5 and Visa, it uses biometric eKYC for secure verification, enabling bank account openings and virtual Visa card issuance. Cooperative Bank of Oromia is the first to integrate it, targeting underserved communities. The wallet supports online/offline access, including agent-based services for non-smartphone users, aligning with Digital Ethiopia 2025 Strategy. It aims to boost financial inclusion for 120 million citizens, streamline transactions, and strengthen Ethiopia’s digital economy.
This is interesting because Ethiopia in my view is one of the last frontiers for Fintech in Africa. That they have launched a digital wallet that’s tied to the Fayda ID system is critical. They have already solved a critical element of digital payments - identity. A national instant payment system will find an existing identity structure that works effectively like UPI in India. This takes away a unique advantage of Mobile Money - the embedded identity advantage that accrues to the telco as a Sim-card issuer. This could potentially mean that Ethiopia becomes an attractive market for Fintechs like Wave, O-Pay or Moniepoint or at least those structured as consumer fintechs.
🇰🇪 | Safaricom to Launch Sub-$1 Micro-Insurance for Matatu Passengers
Safaricom, Kenya’s leading telco, plans to launch a micro-insurance product for matatu passengers, costing under $1, integrated into M-PESA, as announced at the Connected Africa Summit 2025. The product targets low-income commuters, offering affordable coverage to enhance financial security in Kenya’s public transport sector. With only 3% insurance penetration in Kenya, Safaricom leverages its 33.5 million M-PESA users to drive uptake. The initiative follows its recent insurance license from the Insurance Regulatory Authority (IRA), enabling broader financial service offerings. This move strengthens Safaricom’s fintech dominance, promotes financial inclusion, and intensifies competition with traditional insurers.
I wrote this week about how the world is shifting towards a barbell like economic structure. Large corporations that provide tooling on one hand such as Stripe, Alphabet and MTN - while on the other hand we have gig-workers, solopreneurs and small businesses as the middle is hollowed out. This is a useful context for thinking about the growth of products such as digital savings and insurance. As urbanisation adds to the shifting economic paradigm, players like Safaricom are angling towards becoming the primary financial platform for the retail side of the economic barbell. Chime for instance counts 64% of its users as using Chime as their primary bank account. Similar percentages exist for Nubank in Brazil. Individuals are shifting more towards platforms like M-Pesa as their primary financial platform as they don’t fit the mould of traditional income profiles i.e. steady and predictable. It’s an imperative that banks have to recognise in their retail banking strategies.
🇲🇱 | TerraPay and Wave Mobile Money Partner to Enhance Remittance Services in Mali
TerraPay, a global money movement company, partnered with Wave Mobile Money to enhance cross-border remittance services in Mali, announced on May 29, 2025. The collaboration enables Malians to receive funds from the US, Canada, and Europe directly into Wave mobile wallets, offering a faster, cost-effective alternative to informal channels. TerraPay’s network integrates multiple Money Transfer Operators through a single connection, ensuring instant, compliant transfers. With over 80% of Mali’s population using mobile phones, this strengthens financial inclusion for the unbanked. The partnership, involving Orabank Mali, aims to drive economic growth and expand digital payment access in West Africa’s growing remittance market.
I remember writing about Wave back in 2021 and highlighting the growth potential. Everett Randle did a better job than me and produced this graphic;
The core arguments being made at the time was that at core, Wave had a technological advantage to traditional telco in the sense that they had modern proprietary platforms that enabled faster product releases. This was in contrast to Telcos that often have off the shelf services from players like Huawei or Comviva. Nonetheless, at the end of the day, MoMo in Africa is all about ground game and this is where Telcos thrive. Having said that, Wave is validating the original thesis that from simple payments and cash transactions, Wave can build a comprehensive financial super-app.
🇬🇧 | Monzo Achieves £1.2B Revenue Amid Product Expansion
British digital bank Monzo reported a 48% revenue increase to £1.2 billion ($1.6 billion) for the fiscal year ending March 31, 2025, with pre-tax profit quadrupling to £60.5 million from £13.9 million. Growth was driven by a 25% rise in customers to 12.2 million, with 33% using Monzo as their primary bank, and expansion in business banking, lending, and subscriptions. Customer deposits grew 48% to £16.6 billion. The bank is preparing for a potential IPO, possibly valuing it at £6 billion, but CEO TS Anil stated it’s too early to confirm details. This strengthens Monzo’s position as the UK’s largest digital bank, intensifying competition with traditional banks and fintechs.
These two tables stood out for me. At the top, Monzo has moved over time from being a bank that relied primarily on fee income to one that relies significantly on interest income. In fact, most of their revenue growth can be attributed to interest income growth. This has grown 35x compared to fee income which has grown only 6x since 2021. If Monzo had continued to rely solely on fee income, it would have been stuck. A cynic can then argue that Monzo is riding solely on a higher interest rate environment, whilst that is partly true, the bigger picture is that their customer deposits have grown from GBP 3.1 billion to GBP 16.6 billion in the same period showing that more and more people are putting their trust in Monzo. This is a secular issue. A lot of the discussion about Neobanks and customer trust treat the latter as a static variable i.e. it doesn’t change. Having run a digital banking platform, I know fully well that trust grows with time. I recently wrote that Neobanks will soon overtake their mid-sized peers as that’s where the competition is. I expect Monzo to be bigger than the likes of Metro Bank from a profit perspective by the end of the decade. Players like Fairmoney, Carbon, Tymebank will see significant deposit growth in the coming years.
🇷🇺 | Sberbank Launches Bitcoin-Linked Bonds for Qualified Investors
Sberbank, Russia’s largest bank, issued structured bonds tied to Bitcoin’s price and the USD/RUB exchange rate, targeting qualified investors, as announced on June 3, 2025. The bonds, settled in rubles, allow exposure to Bitcoin without direct crypto ownership, aligning with Russia’s regulatory framework. Future issuances will be listed on the Moscow Exchange, with Bitcoin futures trading starting June 4 via SberInvest. The Bank of Russia’s recent approval of non-deliverable crypto derivatives enabled this move, reflecting a shift toward regulated crypto integration. This enhances investor access to digital assets, strengthens Sberbank’s financial innovation, and positions Russia in the global crypto market.
Sberbank is a really interesting bank. It’s a digital leader globally despite being tied at the hip to the Russian government. It’s super-app is one of a kind and it has built a truly world-class ecosystem proposition. I’ve written about it here and here. What this story shows is that banks are moving more and more towards embracing Crypto particularly from a custody perspective. This is a demand-driven approach as high net-worth individuals add crypto to their asset holdings strategically. Companies like Luno and Ovex in Africa are doing very good business on the back of this trend. As VASP licensing goes mainstream, banks need to start thinking about Crypto to begin with, with their private banking or high net worth clients.