Payhippo has acquired Maritime Microfinance Bank, a financial institution that offers loans, supports investments and accepts deposits and savings. Although the Central Bank of Nigeria (CBN) is yet to approve this acquisition, Payhippo says this acquisition will enable them to directly access Nigeria’s Inter-bank Settlement System (NIBSS).
Maritime, founded in 2014, is a traditional financial institution that offers lending to micro businesses (which include freelancers, solo entrepreneurs, and side hustlers) and SMEs (which include businesses with up to 500 employees) in the maritime industry. But PayHippo’s acquisition of Maritime will help the MFB expand into new sectors.
Following this acquisition, Payhippo merchants will be able to accept deposits and send and receive money across various commercial banks in Nigeria.
Payhippo was founded by Chioma Okotcha, Uche Nnadi, and Zach Bijesse, to provide Nigerian small businesses with access to credit. According to the Lagos-based fintech, which has received $4.1 million in VC funding since it launched in 2019, it has disbursed over 25,000 loans to small and medium enterprises in Nigeria and earns over $4 million in revenue annually.
First-time entrepreneurs in Africa often have a hard time raising capital, by way of credit, from traditional lenders. These cash-strapped founders are discouraged by financial bureaucracy, high interest rates and hard-to-meet collateral requirements.
Digital lenders that offer lower rates and flexible credit processes attract bootstrapped businesses seeking capital; these unconventional lenders have also given rise to a booming industry for digital lenders that are not bound by rigid financing laws.
Speaking with TechCabal on a call, Payhippo’s CEO and co-founder Zach Bijesse revealed that the startup had begun mapping out acquisition plans since the beginning of the year.
When the acquisition gets the green light, Maritime will adopt Payhippo’s corporate brand, while Payhippo will extend its digital services to existing Maritime customers.
The date for the approval of the acquisition is still unknown, Bijesse had told TechCabal.
“Nigeria has an ever-growing need for SME lending solutions to help businesses meet their financial needs. We believe Payhippo is well-positioned to develop new and customized financial products for SMEs in the country.” Maritime Microfinance Bank’s Chairman, Adetola Atekoja said in a statement.
In May 2021, Kenyan digital lender Branch acquired Century Microfinance bank, enabling it to receive deposits and enhance lending for individual and SME customers.