Stripe, a leading American financial services tech company has acquired Nigerian fintech startup Paystack to expand into the fast-growing online market in Africa, the companies disclosed.
The acquisition, reportedly worth $200 million, further deepens the growing interests of fintech giants in the ever-expanding online commerce sector of Nigeria and Africa at large.
”In order to help increase Africa’s online GDP, Stripe has entered into an agreement to acquire Paystack, a technology company based in Lagos that makes it easy for organizations of all sizes to collect payments from around the world,” a statement on Stripe’s website read.
“In just five years, Paystack has done what many companies could not achieve in decades. Their tech-first approach, values, and ambition greatly align with our own.”Paystack is one of several fintechs that have disrupted the Nigerian fintech space. It has developed APIs for identity verification, checking of account balances, automating bank transfers, among many things.
The result of all of these is that, along with other fintech startups like Flutterwave, it has reduced the cost of processing payments in Nigeria. Solving this payment processing problem means that Paystack serves around 60,000 customers.
But beyond the number of customers Paystack brings to the table, Nigeria is thought of as a promising frontier market and is ripe for Stripe to expand into. Stripe’s recent strategy is geographical expansion.
In the last 18 months, it has added 17 countries to its platform and this recent acquisition is an interesting commentary on the global fintech’s perspective of the African market.