TheCable

Leading pan-African integrated payments company, Interswitch Transnational Holding (Interswitch), has announced reaching a partnership agreement with East Africa’s leading multi-institutional payments provider, Paynet Group (Paynet), to combine businesses.

Interswitch will acquire a majority shareholding in Paynet Group, while Paynet’s existing shareholders will become shareholders of the Interswitch Group.

Under the agreement, Bernard Matthewman, current CEO of Paynet, will stay on as CEO. Paynet’s existing shareholders will become shareholders of Interswitch.

It also means the expansion of Interswitch and Paynet is accelerated, as their presence will span nine African countries, consequently supporting Interswitch’s strategic objective of becoming the truly pan-African electronic transactions business.

“The transaction creates an unrivalled payment infrastructure across East and West Africa,” Interswitch said in a statement, enthusing that the new combined network will connect over 100 financial institutions.

Both companies say the deal would enable them take advantage of fast-growing East-West Africa trade and continue providing their customers – both businesses and government – with a trusted partner.

The new company will create an unrivalled payment infrastructure across East and West Africa, uniting financial institutions on a single network, integrating transaction solutions seamlessly into businesses, and creating a secure and convenient way to make cross-border transactions.

The new combined network will connect over 100 financial institutions in West and East Africa.

“To build a successful payments business, customers are looking for trust, scale, efficiency and a proven track record of execution,” group managing director and chief executive officer of Interswitch, Mitchell Elegbe (pictured), said.

“This partnership will significantly expand our footprint in East Africa and uniquely positions Interswitch in the market. The new business will provide comprehensive solutions for regional and international businesses looking to take advantage of growth opportunities in Africa.

“Paynet has done a great job at building an innovative and trusted payments company in East Africa and we are confident that between us, we can drive growth by continuing to provide payment solutions that are highly tailored to the African market.”

Also speaking on the deal, Bernard Matthewman, CEO of Paynet, noted the “rapid movement” of the payments market in East Africa into an era where specific products are required for sectors such as transport, health, government and county payments, as well as the move towards secure Internet-based payments.

“Paynet has been looking for a partner that has both products and experience in these areas so we can rapidly deliver them in the most efficient manner,” Matthewman said.

“Interswitch has the most comprehensive range of products of any provider we have seen in an emerging market and this alongside their existing presence in Uganda provides us with additional strength as we continue to grow in East Africa.”

Founded in Kenya in 2003 by the current senior management team, Paynet has provided services to some 70 financial institutions and over 2,000 companies, as well as numerous public sector entities.

Interswitch is a Pan-African, integrated payment and transaction processing company, provides technology integration, advisory services, payment infrastructure to government, banks and corporate organisations.

The deal, which is subject to regulatory approvals, comes at a time when both governments and private institutions across Africa are looking to cashless solutions and financial inclusion to accelerate economic growth and drive business efficiency.