The big news in the world of e-commerce today is Stripe’s acquisition of Paystack, a Nigeria-based payments system that is widely used throughout African markets. The company, which became informally known as “the Stripe of Africa” picked up $8 million in Series A funding in 2018, led by Stripe, Y Combinator, and Tencent. Paystack has grown to power more than 60,000 businesses, including FedEx, UPS, MTN, the Lagos Internal Revenue Service, and AXA Mansar.
Stripe’s acquisition of the company is rumored to be more than $200M, a small price to pay for a foothold in emerging African markets. In the company’s announcement, Stripe noted that African online commerce is growing 21% year-over-year, 75% faster than the global average. Paystack dominates among payment systems, accounting for more than half of all online transactions in Nigeria.
“In just five years, Paystack has done what many companies could not achieve in decades,” Stripe EMEA business lead Matt Henderson said. “Their tech-first approach, values, and ambition greatly align with our own. This acquisition will give Paystack resources to develop new products, support more businesses and consolidate the hyper-fragmented African payments market.”
Long term, Stripe plans to embed Paystack’s capabilities in its Global Payments and Treasury Network (GPTN), the company’s programmable infrastructure for global money movement.
“Paystack merchants and partners can look forward to more payment channels, more tools, accelerated geographic expansion, and deeper integrations with global platforms,” Paystack CEO and co-founder Shola Akinlade said. He also assured customers that there’s no need to make any changes to their technical integrations, as Paystack will continue expanding and operating independently in Africa.
Paystack is used as a payment gateway for thousands of WordPress-powered stores through plugins for WooCommerce, Easy Digital Downloads, Paid Membership Pro, Give, Contact Form 7, and an assortment of booking plugins. The company has an official WordPress plugin, Payment Forms for Paystack, which is active on more than 6,000 sites, but most users come through the Paystack WooCommerce Payment Gateway (20,000+ active installations).
Stripe’s acquisition was a bit of positive news during what is currently a turbulent time in Nigeria, as citizens are actively engaged in peaceful protests to end police brutality. Paystack’s journey is an encouraging example of the flourishing Nigerian tech ecosystem and the possibilities available for smaller e-commerce companies that are solving problems and removing barriers for businesses in emerging markets.