By TWV Reporter
KCB Group has entered into an agreement to acquire a minority stake in payment service provider Pesapal. The deal, which was announced on Friday, 31 October, is seen as a strategic investment aimed at driving innovation in digital payments and enhancing financial inclusion for small and micro enterprises across Kenya and the region.
“We are delighted to inform our shareholders and the investing public that KCB Group Plc (KCB) has, on 31 October 2025, entered into an agreement to acquire a minority stake in Pesapal Limited (Pesapal). Pesapal is a limited liability company licensed by the Central Bank of Kenya as a payment service provider. The investment sets the stage for the development of innovative payment and other related solutions for Kenya’s small and micro enterprises, enhancing value for the shareholders of both Pesapal and KCB,” KCB said in a statement. “The investment is subject to conditions that are customary for transactions of this nature, including receipt of regulatory approvals from the Central Bank of Kenya.”
In March, KCB also announced the acquisition of a 75 per cent controlling stake in Riverbank Solutions Limited, another Kenya-based fintech company.
According to Mastercard, Kenya’s digital payments market continues to expand, with a projected compound annual growth rate (CAGR) of 14.1 per cent between 2024 and 2028. By 2028, the market value is expected to reach US$14.52 billion.
By integrating digital payments into its core systems, KCB is moving away from reliance on apps, which are slow, prone to outages and carry cash-handling risks.
A study conducted by Visa last year established that while cash remains convenient for its simplicity and wide acceptance, digital payments offer merchants an innovative edge and the potential to boost customer spending.
“This nuanced understanding is crucial, especially given the dominance of mobile and digital wallets, which demonstrates a clear trend towards cashless transactions. The shift towards digital solutions is further evidenced by the 40 per cent of SMEs already utilising financial technology and the significant majority (68 per cent) planning to invest in new digital payment technologies. Nearly one in four (24 per cent) cash-only SMEs plan to acquire POS systems, and 52 per cent of cash-only SMEs intend to invest in new payment technology overall. This, combined with the 61 per cent of existing digital payment users who plan to invest further, particularly in card payments (45 per cent), points to significant future expansion,” it said.
