Moniepoint Secures 78% Stake in Kenyan-based Sumac Microfinance Bank

Africa’s fastest-growing fintech company, Moniepoint Inc., has made a major move by securing a 78% stake in Sumac Microfinance Bank, a Kenyan-based financial institution. This big step was given the green light by the Competition Authority of Kenya (CAK), which said the deal would not harm competition or cause any public concern in the Kenyan financial sector.

Moniepoint secures 78% stake in Sumac Microfinance Bank as part of its strategy to expand across Africa, especially into Kenya’s lively financial market. The CAK explained that this transaction is considered a merger under Kenyan law because Moniepoint is taking control by buying most of Sumac’s shares. Since both companies together have more than KES 1 billion (about $7.7 million) in turnover, the deal needed a full review and official approval before it could go ahead.

Sumac Microfinance Bank, founded in 2002 and licensed as a deposit-taking microfinance institution in 2012, is known for offering a variety of banking services. These include giving out loans, taking deposits, and helping small businesses and individuals manage their money. With a market share of 4.3%, Sumac is considered a medium-sized player in Kenya’s microfinance sector, which has 14 institutions in total.

Moniepoint secures stake in Kenyan-based Microfinance Bank at a time when more fintech companies are looking for ways to grow quickly in new markets. By acquiring Sumac, Moniepoint can now enter Kenya without having to go through the long process of getting a new banking license from scratch. The CAK pointed out that since Moniepoint did not previously operate in Kenya, this acquisition will not change the way the market works or make it harder for other banks to compete.

Importantly, the CAK also looked at how this deal would affect people’s jobs and the wider public. They found that there would be no job losses, and all current Sumac employees would keep their jobs and their current employment terms. The regulator also said there would be no negative effects on small businesses or the wider financial industry.

Moniepoint’s 78% stake in Sumac Microfinance Bank is part of a bigger trend where African fintech companies are buying up smaller banks to grow faster and reach more customers. Other Nigerian companies, like Access Bank and Flutterwave, have also expanded into Kenya recently.

This acquisition is a big milestone for Moniepoint, showing its commitment to spreading digital financial services across Africa. With Moniepoint’s technology and experience, Sumac Microfinance Bank is expected to improve its services and reach even more people in Kenya, especially those who are not well served by traditional banks.

Moniepoint secures 78% stake in Sumac Microfinance Bank, marking a new chapter for both companies. The deal is set to bring more innovation and competition to Kenya’s financial sector, while making sure that jobs and public interests are protected.

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