New battleground in South Africa – with Nedbank and Capitec spending billions
South Africa’s payments industry is undergoing a significant transformation, with combined acquisitions reaching the billions.
While many South Africans still use cash, digital payments are being increasingly adopted across the economy.
The growing adoption has seen several major JSE-listed companies moving to acquire payment service providers, including Nedbank and Capitec.
The first and largest transaction saw Nedbank acquire iKhokha in an all-cash deal worth R1.65 billion in August last year.
The deal forms part of Nedbank’s plan to support small and medium-sized enterprises (SMEs) through digital innovation and inclusive financial services.
iKhokha has grown rapidly since its founding in 2012 and offers SME cash advances and payment and business management tools.
The acquisition has made iKhokha a wholly owned subsidiary of Nedbank, while it continues to operate under its own brand and leadership team.
South Africa’s largest bank by market cap and customers, Capitec, then announced the acquisition of Walletdoc in a deal valued at up to R400 million in December 2025.
Walletdoc was founded in 2015 and provides payment gateway services for merchants, including in-app payments, digital wallets, Instant EFT, and other financial services.
Capitec said that the acquisition forms part of its strategy to reduce payment costs and expand access to digital financial services.
The purchase consideration for Walletfic comprises a cash payment of R300 million, subject to customary adjustments upon closing.
There is also a deferred earnout of R100 million, which is linked to the Capitec share price and payable in cash over three years. The earnout is subject to the achievement of certain milestones.
While a smaller player than Capitec and Nedbank, JSE-listed payments provider Araxi also announced a deal in which it will acquire fellow payments provider Pay@ in a deal valued at R1 billion.
Pay@ was founded in 2007 and offers scalable payment services for B2B and B2C consumers, with Araxi and Pay@ looking for growth through geographic and service expansion.
The R1 billion deal to acquire Pay@ comprises R200 million in cash and R800 million in senior debt.
Also goes the other way
While two of South Africa’s largest banks have acquired payment service providers, the opposite has also occurred: Lesaka acquired Bank Zero in a deal valued at over R1 billion.
Bank Zero is an app-only digital bank that provides personal and business banking services. It was founded in 2018 by former FNB executives Michael Jordaan and Yatin Narsai.
Lesaka, which is a wholly owned subsidiary of US-incorporated Lesaka Technologies, also provides a host of fintech products and services, including payment services.
In July, Lesaka announced a deal to acquire Bank Zero for R1.1 billion. The main driver of the deal was Lesaka’s aim to cross-sell banking services to its existing customer base in the country.
The deal will primarily consist of a host of newly issued Lesaka shares and up to R91 million in cash. Bank Zero’s shareholders will then own roughly 12% of Lesaka’s fully diluted shares.
As per the deal, Jordaan will join the Lesaka board, and Narsai will join Lesaka’s executive leadership team.
The Bank Zero executive’s shareholding in Lesaka will be subject to lock-up agreements ranging from 18 to 36 months.
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