Stripe-owned Nigerian fintech giant, Paystack, has officially entered Nigeria’s banking space following its acquisition of Ladder Microfinance Bank, a move widely seen as a significant expansion beyond payments into full-stack financial services.
The company announced on Wednesday the launch of Paystack Microfinance Bank, coming exactly ten years after it commenced operations in Nigeria. The development marks a major strategic pivot for the fintech firm, which has built its brand as one of Africa’s leading payment infrastructure providers.
According to Paystack, the newly established microfinance bank will operate independently of Paystack Payments Limited, with its own licence, governance structure and product roadmap, while maintaining close operational synergy with the core payments business.
The move comes amid a wave of consolidation and expansion in Nigeria’s fintech ecosystem. Barely a week earlier, another major fintech, Flutterwave, acquired open banking startup Mono, signalling the growing convergence between payments, banking, data and financial services.
Explaining the rationale behind its entry into banking, Paystack said the decision was shaped by insights gained from serving over 300,000 businesses and millions of consumers nationwide. The company disclosed that it currently processes trillions of naira in transactions monthly, underscoring its central role in Nigeria’s financial ecosystem.
“Payments are a critical part of the financial journey, but not the whole story. Businesses don’t just need to get paid. They need a financial operating system,” Paystack said.
The company noted that beyond accepting payments, businesses require tools to securely store funds, move money seamlessly, access financial insights and scale sustainably. Individuals, on the other hand, seek financial products that help them protect, grow and use their money as their ambitions evolve.
To address these needs, Paystack said Paystack Microfinance Bank has been launched as a separate company focused on building banking products, while Paystack Payments Limited continues to concentrate on payment infrastructure.
The fintech firm revealed that the bank has already onboarded a small group of early users and will gradually open access to more businesses and individuals. The acquisition of Ladder Microfinance Bank provides Paystack with a regulated foundation to offer banking services at a time when the lines between fintechs and traditional financial institutions are increasingly blurred.
Expert Reactions
Reacting to the development, Celestine Ukpong, an economist, described Paystack’s move as a natural evolution in Nigeria’s fintech landscape.
“Payments alone no longer guarantee long-term growth for fintechs. By moving into banking, Paystack is positioning itself to capture more value across the financial services chain, particularly among SMEs that need integrated solutions,” Ukpong said. He added that the entry of a major payments player into microfinance banking could improve competition, innovation and financial inclusion if properly regulated.
On his part, Peter Adebayo, FCA, said the acquisition reflects growing confidence by fintechs in Nigeria’s regulatory environment.
“This is a strategic move that aligns with global trends where fintechs evolve into licensed financial institutions. Operating a microfinance bank allows Paystack to mobilise deposits, manage funds more efficiently and deepen customer trust,” Adebayo noted. However, he cautioned that governance, risk management and regulatory compliance will be critical to sustaining credibility in the banking space.
Paystack also reiterated that developers remain central to its strategy, stressing that modern financial services require secure, reliable and compliant infrastructure that enables builders to create innovative products quickly.
Analysts say Paystack’s move highlights a broader trend among African fintechs seeking to offer end-to-end financial services as payments become increasingly commoditised. For Nigeria’s financial ecosystem, the entry of a dominant payments company into banking is expected to intensify competition, especially in the microfinance and SME-focused segments, while reinforcing the ongoing convergence between fintechs and licensed banks.
Paystack was founded in 2015 by Shola Akinlade and Ezra Olubi, and was acquired by global fintech giant Stripe in 2020 in a $200 million deal.
Paystack has entered Nigeria’s banking sector with the acquisition of Ladder Microfinance Bank, launching Paystack Microfinance Bank as experts say the move will deepen competition, innovation and financial inclusion.
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