Frontier Fintech GPS# 40 - July 16th 2025
Stitch acquires Efficacy Payments, UPI goes to Namibia, Craft Silicon builds voice agents and many other stories that matter.
Illustration by Mary Mogoi
Hi All, Welcome to the 40th 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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🇿🇦 | Stitch Acquires Efficacy Payments to Expand in South Africa
Stitch has acquired Efficacy Payments, a designated clearing system participant (DCSP) in South Africa. This acquisition allows Stitch to become a DCSP itself, enabling it to offer card-acquiring services directly to merchants. The move is intended to provide more seamless, secure, and cost-efficient transactions. This follows Stitch's January 2025 acquisition of ExiPay, which expanded its services from online to in-person payments. These developments strengthen Stitch's position as a comprehensive payments partner for businesses. The company aims to continue broadening its product suite and driving financial inclusion.
This podcast discussion with Kiaan is a great place to start if you want to have a framework for understanding Stitch’s next moves.
They’re committed to winning in the Enterprise payments space in South Africa and this is an area they’re building strong capabilities around. Secondly, Kiaan seems to index a lot of his decisions on what customers want. This was the core idea behind their acquisition of Exipay. This specific transaction seems to be guided by the need to either capture more margin, have better control of the end to end payment experience or both. If your goal is to win in enterprise, then it only makes sense that you can guarantee specific service levels. To this end, this transaction makes sense and I suspect there will be more on the horizon.
🇳🇦 | NPCI and Bank of Namibia to Implement UPI-like System
The National Payment Corporation of India (NPCI) and the Bank of Namibia (BoN) have signed a licensing agreement to deploy a Unified Payments Interface (UPI)-like instant payment system in Namibia. This partnership aims to modernize Namibia's financial infrastructure by leveraging India's UPI technology. The implementation will facilitate real-time payments for individuals and merchants, promoting digital finance services and economic inclusivity. This marks the first instance of NPCI International collaborating with a central bank to deploy the UPI Stack. The initiative is expected to enhance digital cooperation between the two nations.
This makes sense on so many levels, there’s no need to re-invent the wheel, UPI works great and is an exportable model. On the other hand, African Central Banks will need to drive more instant payment systems as digital payments replace cash. This is driven primarily by the need to ensure that digital payments are accessible and not in the sole control of a few private sector players. This is validated by the recent announcement by the Tanzanian Central Bank that it’s capping fees on remittance transactions and urging all IMTO’s to terminate through TIPS. Another point of validation is Ghana’s recent CBDC trials. For India, it’s a new form of soft power diplomacy as it starts to flex its muscles in the global geopolitical space.
🇰🇪 | Craft Silicon Pilots AI Chatbot for Banking
Craft Silicon is piloting a generative AI chatbot named "Small Talk" for the Kenyan banking system. The chatbot is linked to core banking systems and can answer financial queries in both English and local languages. Users can access it through mobile banking apps to check account balances, get saving tips, and address other financial concerns. Craft Silicon CEO Kamal Budhabhatti stated that future interactions with the technology are expected to be voice-based, which could reduce costs associated with training on new products. This innovation was announced at the 2025 Sacco Summit in Nairobi.
This is not me shamelessly plugging my podcast, but this discussion with Kamal was a useful framework for understanding this new product.
At core, Kamal believes that voice will be the primary way people will use AI. In my discussions with him both in the podcast and privately, we’ve both spoken about the power of building AI driven voice capabilities with local dialects over a neobank or financial service provider. The big question is whether the value from this is better captured by him building out the full-stack i.e. a Neobank or Craft Silicon selling this to banks. The decision so far seems to be the latter and my view is that Craft has way more context than I do on why that’s the best approach.
🇰🇪 | M-KOPA Sells Over 1 Million Smartphones in First Year
Fintech firm M-KOPA has sold over one million of its own-branded smartphones within 12 months of their launch. This milestone highlights the demand for affordable, high-quality devices that are also embedded with financial services. M-KOPA's smartphones include the company's Smart Money Platform, which provides access to health insurance, credit, and device protection, thereby promoting financial inclusion. The devices are assembled at the company's plant in Nairobi, which is now the largest smartphone factory in Africa by volume and has created over 400 jobs. This success demonstrates a strategic shift where devices are not just for internet access but are tools for economic empowerment.
This is an incredible milestone for M-Kopa. At the core of things is that as arguably Kenya’s largest mobile phone distributor, there’s significant FX risks as a trading entity and thus building manufacturing capabilities takes some of this risk off the table. Moreover, from a balance sheet perspective, it’s also more efficient. Ultimately, this can be viewed in the same lens as MTN announcing cloud capabilities in Nigeria. Traditional businesses such as Dangote have always seen the value in graduating to manufacturing from trading because the long-term economics are better. The tech industry is maturing and behaving more like the OGs.
Additionally, with M-Kopa manufacturing their own devices, they capture more of the economics of each device sale.
🌍 | MaxAB-Wasoko Shifts Focus to Fintech for Profitability
MaxAB-Wasoko, the merged B2B e-commerce giant, is intensifying its focus on financial technology (fintech) to drive profitable growth across its African markets. This strategic pivot involves scaling back its traditional e-commerce operations, which are characterized by low margins, in favor of expanding its fintech services. The company is already seeing significant returns, with its fintech arm in Egypt generating over $180 million in annual revenue. This shift from asset-heavy retail to embedded finance is a key strategic move to ensure sustainable growth and profitability in its five active markets: Egypt, Morocco, Kenya, Rwanda, and Tanzania.
I recently wrote about the challenges of embedded finance in Africa when I wrote about Mercado Libre and their incredible Fintech business that now accounts for US$ 8.6 billion in revenue, around 40% of total revenues. The core point made was that like Alibaba and Alipay, Mercado built both e-commerce and payments from scratch when the market didn’t have either. They were therefore able to educate the market and set the standard on how e-commerce is done. In Africa, e-commerce and fintech have grown separately and therefore it takes a bit more ingenuity to unite them.
An example may suffice. 4G Capital gives loans of up to US$ 2,000 to vendors using a largely off-line approach. This is a “Fintech” that has grown separately to a Wasoko. If that vendor is to be approached by Wasoko, their Fintech problem is already solved. The value then becomes tenuous. It’s going to be harder for such platforms to build sizable Fintech businesses.
🇰🇪 | Watu Credit Finances 3 Million Smartphones in Africa
Watu Credit, an asset financier, has financed over 3 million smartphones across the eight African countries where it operates. The company's Head of Growth, Kevin Michuki, stated that this achievement is just the beginning, as smartphone penetration in the region is just over 70%, indicating significant room for growth. Watu Credit also finances motorbikes, three-wheelers, and cars, and has provided over 2 million loans in total. The company's "buy now, pay later" and "pay-as-you-go" platforms have enabled low-income individuals in underserved areas to acquire these devices. This initiative is part of Watu Credit's strategy to expand its presence across East Africa and new markets on the continent.
Watu has successfully grown the device lending business and diversified away from lending primarily to motor cycles. The broader motor-cycle space has suffered a significant decline in demand and this has been a persistent trend over the last two years. This article gives more detail. Watu is therefore going deep into device lending but will face a formidable competitor in M-Kopa. To this end they’ve been growing their Fintech capabilities and recruiting a lot more tech talent. They’re additionally planning to expand to LatAm as per an interview recently given by Nikhil Patel, their Chief Growth Officer.
🇳🇬🇿🇦 | Bamboo Launches in South Africa to Offer U.S. Stocks
Nigerian investment platform Bamboo has officially launched its services in South Africa, providing local users with access to the U.S. stock market through fractional investing. This expansion allows South Africans to invest in global companies with as little as ZAR 150, addressing a growing demand for dollar-denominated assets and portfolio diversification amid local currency volatility. The move is strategically significant as it places Bamboo in direct competition with existing South African wealthtech platforms like EasyEquities.
Nigerian investment platforms like Bamboo, Cowrywise, Piggyvest and Risevest have been growing and expanding into the continent. It’s a space I admire despite the fact that they don’t get the attention that their cousins in payments do. Fundamentally, it’s a slower business to scale unlike payments. However, I think if players like Bamboo do well, they’ll be able to build robust relationships with their clients. This may need to be augmented by some form of off-line structure such as “Bamboo Cafe’s” or Co-Working spaces where they can build community. Nonetheless, the fact that they have a good number of MAUs shows that they’re building the basic foundations for expanding into other elements of personal financial services such as basic accounts and lending. They’re definitely an industry worth watching.
🇿🇦 | MoneyBadger Raises $400,000 in Pre-Seed Funding
MoneyBadger, a South African Bitcoin and crypto payments solution provider, has secured $400,000 in a pre-seed funding round led by P1 Ventures and three angel investors. The company, which originated from a project to enable Bitcoin payments at Pick n Pay, has developed a payment system utilizing the Bitcoin Lightning network. This funding will support the expansion of its merchant network, which currently includes over 1,600 outlets. MoneyBadger integrates with several crypto wallets and exchanges, including Binance, Luno, and VALR, facilitating crypto payments for a variety of goods and services. The company aims to expand its services to more merchants, use-cases, and countries.
Luno has done a great job and has impressive ARR numbers as well as TPV. This speaks to the core founding team of which Carel Van Wyk, CEO of Moneybadger was a member. As Crypto goes mainstream, driven by increased adoption amongst younger people, then it’s natural that every day payment capabilities will be built. As I wrote in my most recent article, the surrounding infrastructure has matured, from wallet providers like Fireblocks to KYC players like Sumsub and even the Bitcoin Lightning Network - built to enable fast bitcoin based payments. I’d keep a close eye on MoneyBadger, mostly for the founding team’s capabilities.
🇬🇭 | Bank of Ghana to Regulate Cryptocurrencies
The Governor of the Bank of Ghana (BoG), Dr. Johnson Asiama, announced a policy shift towards regulating cryptocurrencies, stating the bank cannot stop their use. This marks a change from the BoG's previous stance, which warned that cryptocurrencies were not legal tender and prohibited licensed financial institutions from facilitating such transactions. The new approach involves collaboration with the Securities and Exchange Commission (SEC) and the Ghana Revenue Authority (GRA) to create a regulatory framework. The BoG plans to implement full regulation of virtual assets by the end of September 2025, pending the passage of a Virtual Asset Service Providers (VASP) Act. This move is intended to foster innovation, enhance financial inclusion, mitigate risks like money laundering, and align Ghana with international standards set by the Financial Action Task Force (FATF).
I argued the same in my most recent article. I’ve been sceptical about Crypto in the past but the reality is that grassroots adoption is strong and it’s solving core problems particularly as gig-work scales. Another factor to think about is the role of urbanisation and the need for wealth preservation. Young Africans can’t go buying livestock like their ancestors to store value because where do you even store your livestock?
🇰🇪 | Engage Capital to acquire Lipa Later for $24.5M
Engage Capital, a Kenyan venture firm, has made a $24.5 million offer to acquire the buy now, pay later (BNPL) startup, Lipa Later. The offer, made in May 2025, would see Engage Capital take over Lipa Later's technology, licenses, and customer base, while also clearing some of its debts. This acquisition is significant as it represents a potential recovery for Lipa Later, which entered administration in March 2025 after failing to secure a new funding round. If the deal is successful, it would be a rare instance of an African startup recovering value after collapse. The move signals Engage Capital's belief in the viability of the BNPL model in Africa, despite Lipa Later's previous struggles.
This was an interesting one. BNPL is making a come-back particularly if you look at the South African BNPL space that has been doing really well, driven by players such as Pepkor Holdings. Engage must see this opportunity. The challenge is that Kenya is a completely different beast. Formal retail in South Africa hovers at around 60% of the total retail market. In Kenya it's around 20%. What this means is that BNPL has taken an informal route. An example may work, Silvano my shoe plug sends me shoes and I pay him at the end of the month. Sometimes he even sends a pair without me even asking. The business and the subsequent financing is based on trust. On his side, he probably takes a loan from the numerous SME lending players to finance his stock. BNPL based on formal retail faces some serious challenges in markets such as Kenya.