It’s raining acquisitions in South Africa.
In the telecom space, the much-talked-about Vodacom-Maziv merger is nearing completion after a conditional approval. Yesterday, Cell C also received approval to acquire Blue Label’s CEC.
The startup space is not left out, either. In May, Lesaka Technologies acquired neobank Bank Zero in a R1.1 billion ($61 million) deal. In that same vein, Nedbank, South Africa’s fourth-largest commercial bank by assets, has acquired iKhokha, deepening its paws into digital payments for businesses.
iKhokha will operate as a wholly-owned subsidiary, keeping its brand, leadership, and entrepreneurial culture under a management lock-in. With Nedbank’s resources, regulatory backing, and customer reach, it will speed up launches of new payment solutions, SME credit products, and business management tools, while exploring expansion into other African markets.
The deal, an all-cash transaction worth R1.65 billion ($94 million), marks one of the few examples of South African commercial banks buying fintechs. In 2019, Capitec—now the country’s fifth-largest bank—acquired Mercantile Bank, which had pivoted to digital business banking.
Why does this deal make sense? Nedbank gains a fast track into the SME economy, a segment that drives most employment and billions in revenue but still leans heavily on cash. iKhokha’s mobile point-of-sale (PoS) devices, business tools, and payments infrastructure slot directly into Nedbank’s offerings, creating a ready-made fintech arm. Its alternative credit scoring uses transaction data to unlock loans for underserved SMEs, aligning with Nedbank’s lending push and financial inclusion goals.
With R20 billion ($1.1 billion) in annual payments and R3 billion ($171 million) in SME loans, iKhokha brings both growth potential and a competitive edge. It positions Nedbank ahead of rivals without an integrated SME ecosystem of payments, credit and analytics, while deepening its stake in the more nimble fintech market.
