African payments company Interswitch has secured a $110 million joint investment from LeapFrog Investments and Tana Africa Capital to scale its digital payment services across the continent, the two private investment firms said in a statement Wednesday.
Interswitch didn’t confirm the amount it received from the firms. “The exact terms of the transaction haven’t been disclosed. We can’t comment on that for now,” a spokesperson for the company said to TechCrunch when asked about the investment and Interswitch’s new valuation.
However, Interswitch Group CEO Mitchell Elegbe, in a statement, said the company was “excited to welcome LeapFrog and Tana on board, as we continue our work to advance the future of the African payments landscape.”
This news is coming almost three years since Interswitch’s last disclosed funding round, when Visa paid $200 million for a 20% stake in the company. At $1 billion (its last know valuation), Interswitch is one of Africa’s largest electronic payments and infrastructure companies. The fintech powers much of the rails for Nigeria’s online banking system and is well-known for its point-of-sale terminals, online consumer payment platforms, Quickteller, and Verve, the biggest domestic debit card scheme in Africa, issuing over 35 million active cards since launch.
In 2016, Interswitch taunted the idea of going public. In an interview that year, CEO Elegbe told TechCrunch that the company would pursue a dual-listing on the London and Nigeria stock exchanges.
Subsequent reports of the 20-year-old fintech listing on a major exchange also surfaced in 2019 and 2020; but that plan seems to have been shoveled into the back seat following its investment from Visa.
As much as an Interswitch exit is a win for the African tech ecosystem, it is also a win for the company, its executives, and particularly its largest shareholder, U.K.-based Ignite Holdco Limited (made up of Helios Investment Partners and TA Associates). But since that isn’t forthcoming, the holding company has found an immediate alternative. In addition to pumping new capital into Interswitch’s business, part of the new investment involves LeapFrog and Tana acquiring shares from existing shareholders, including Ignite Holdco Limited.
“Interswitch, a pioneer in the African payments ecosystem, has been disrupting the cash economy, driving digital payments and promoting equitable financial inclusion in Nigeria for two decades. This investment by LeapFrog affirms the formidable talent at Interswitch and how well-placed it is to seize the significant opportunity in Africa’s evolving digital payments landscape,” said LeapFrog Investments, partner, head of Africa financial services, Karima Ola, in a statement.
