Nigerian credit-led digital banking platform Fairmoney has acquired Payforce, a merchant payment service to build a robust network of financial service points to aid small businesses across the country.
The terms of the deal were undisclosed, however, sources familiar with the transaction revealed that it could range between $15 million to $20 million.
Fairmoney’s acquisition of Payforce was fueled by the startup drive to take on the daring task of rebuilding Africa’s money story after reports reveal that consumer payments in Africa will reach $2.1 trillion by 2025, but currently, only 5% of these transactions are digitized which has seen merchants faced with the difficulty of collecting payments seamlessly.
Speaking on the recent acquisition of Payforce, CEO of FairMoney Laurin Hainy said, “We see ourselves as a retail bank, but the line between merchants and retail is often blurry. We’ve thought about the merchant space more and more, and we see a lot of potential synergies between what PayForce, and we have built independently.
“We know that if we combine both businesses, their merchants will enjoy what our retail customers already enjoy. Our view is that PayForce has an advantage because its software is built for the finance manager and small business owners.
“PayForce helps them make more money versus a lot of the other competition, which we think are agency banking businesses, as they did not build a product with the merchant in mind; they built the product with the agent in mind. There is a huge difference, so we’re not worried about the competitive landscape there.”
Laurin further added that FairMoney intends to increase its market share and establish itself as Nigeria’s “number one” merchant and retail bank following its recent acquisition of Payforce. The fintech plans to expand its business-facing product suite to include payroll services, BNPL, online merchant purchasing, credit cards, remittance, stock, and investment products for its retail consumers.
Also commenting on the acquisition of Payforce by FairMoney, the CEO and Co-Founder of Crowdforce Oluwatomi Ayorinde said “This development is exciting for us at Crowdforce, it feels good for the team to be welcomed into the FairMoney family. This move is in line with the expansion and growth roadmap of the business. Our focus at the moment is ensuring the best experience for our merchants and customers, we are excited for what the future holds for them”.
Investors King understands Ayorinde is joining FairMoney as the head of Payforce by FairMoney, the company’s payments business unit.
While FairMoney has predominantly operated a credit-led neo-banking play targeting retail customers, CrowdForce, through PayForce, provides agency banking services, a branchless banking model that extends financial services to the last mile via a network of human ATMs.