Nigeria’s fintech company Moniepoint got a key regulatory approval to acquire a 78 per cent controlling stake in Nairobi-based Sumac Microfinance Bank Limited, according to a statement by the Competition Authority of Kenya on Monday.
In granting unconditional approval, the authority noted that the deal is not likely to impact competition negatively “in the market for the provision of microfinance banking services in Kenya, nor elicit negative public interest concerns.”
Expanding into Kenya clears the path for Moniepoint to scale its digital banking and payments offering in one of the key financial hubs in East Africa.
Moniepoint, which attained a unicorn status earlier this year after raising $110 million in a Series C funding round valued at over $1 billion, processes $17 billion worth of transactions monthly, according to information on its website.
Incorporated in the US, it started operations in 2019 and now has two subsidiaries incorporated in Nigeria: TeamApt Limited and Moniepoint Microfinance Limited.
Sumac Microfinance Bank, which was established in 2002 originally as an investment group, has operations spanning monetary intermediation, deposit-taking, forex trading, insurance agency and brokerage, lending, financial leasing and money transfer services.
A medium-sized microfinance bank, Sumac controlled a 4.3 per cent share in the Kenyan microfinance bank as of 2023. Total assets at the end of 2023 stood at Ksh3 billion, while total deposits were Ksh1.3 billion.
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Active deposit accounts totalled 15,923 as of 2023, while active loan accounts stood at 2,960.
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The 4.3 per cent market share “will not change due to this transaction since Moniepoint Inc has no operations in Kenya,” the Competition Authority of Kenya said.
“Therefore, post-merger, the structure and concentration of the market for micro-finance banking will not be affected. As such, the transaction is not unlikely to raise competition concerns,” it added.
The regulator assured that there would be no employment loss resulting from the transaction and that all the current employees would be retained under the current terms.
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