Kenya’s banking giant KCB Group has deepened its fintech playbook, announcing a minority stake acquisition in Pesapal Limited, East Africa’s leading digital payments provider.
The deal, signed on October 31, 2025, comes just eight months after KCB’s $15.4 million (KSh 2 billion) purchase of a 75% stake in Riverbank Solutions, solidifying its pivot toward owning the digital infrastructure powering East Africa’s commerce.
Together, these moves signal a clear strategy: KCB is building the financial “plumbing” of the region’s digital economy, embedding payments, credit, and data-driven services directly into business ecosystems.
The Pesapal Acquisition: Powering Payments at Scale
Founded in 2009, Pesapal has grown into one of East Africa’s most trusted payment processors, serving 200,000+ merchants across Kenya, Uganda, Tanzania, and beyond.
Its platform handles millions of monthly transactions, integrating cards, mobile money, and online payments for MSMEs.
KCB’s investment described as “strategic” but with no disclosed percentage is still pending Central Bank of Kenya (CBK) approval. For both sides, it’s less about ownership and more about integration.
Through Pesapal’s APIs, KCB plans to embed payment capabilities into its apps, creating a seamless experience where SMEs can receive payments, access instant loans, and buy insurance within a single digital ecosystem.
“This investment aligns with our commitment to building a full-stack financial ecosystem that empowers businesses and drives economic inclusion.”said Paul Russo, KCB Group CEO
The deal offers mutual advantage: Pesapal gains KCB’s vast 25 million+ customer base, while KCB taps into Pesapal’s merchant networks and real-time transaction data, which is critical for credit scoring and SME financing.
Riverbank Solutions: Laying the Agency Banking Foundation
Earlier in March 2025, KCB took control of Riverbank Solutions, a fintech long behind its agency banking operations.
Riverbank’s platforms, including Zedi 360, Swipe, and CheckSmart, enable deposits, withdrawals, and bill payments through 50,000+ agents across Kenya, Uganda, and Rwanda.
By bringing Riverbank in-house, KCB unified its tech stack and cut reliance on third-party vendors. The move strengthens its control over transaction data, enabling smarter lending and tailored financial services.
Riverbank’s tools now feed into KCB Mobi, positioning it as a viable rival to M-Pesa in mobile banking and agency services. Analysts call this acquisition KCB’s “distribution moat,” ensuring last-mile dominance as fintech competition intensifies.
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KCB’s Fintech Vision: From Banking to Embedded Infrastructure
The Pesapal and Riverbank deals anchor KCB’s 2025–2030 digital strategy, a shift from traditional lending to embedded finance.
The bank aims to integrate financial services into every layer of commerce, from retail payments to supply-chain logistics.
Why Payments?
Payments are the fastest-growing segment in African finance, expected to hit $1.5 trillion by 2030. In Kenya, where over 90% of adults use mobile money, KCB’s strategy is to own the rails, not just the wallet.
Key pillars of the strategy include:
- Cross-Selling Opportunities: Riverbank’s agent network + Pesapal’s digital rails = multi-revenue streams from fees, forex, and analytics.
- SME Empowerment: Using transaction data for AI-driven credit scoring to address Africa’s $331 billion SME funding gap.
- Regional Expansion: Targeting Ethiopia’s opening market and deepening PAPSS integration for faster, cheaper cross-border payments.
- Green Finance Integration: Linking fintech to sustainability; over $578 million in green loans screened by end-2025.
This approach mirrors global fintech-bank convergence seen at JPMorgan, Santander, and DBS, localised for East Africa’s mobile-first economy.
Financial Firepower: Non-Interest Income Surges
KCB’s aggressive fintech pivot is fuelled by record financial performance.
| Metric | 2024 | 2023 | Growth |
|---|---|---|---|
| Profit After Tax | KSh 61.8B | KSh 37.5B | +64.9% |
| Non-Interest Income | KSh 67.5B | KSh 50.4B | +33.9% |
| Total Revenues | KSh 204.9B | KSh 165.2B | +24.0% |
| Net Interest Income | KSh 137.3B | KSh 107.2B | +28.0% |
By mid-2025, non-interest income accounted for 33% of total revenue, up from 30% the previous year, a clear reflection of digital revenue growth.
What’s Next: Ethiopia, AI, and Ecosystem Integration
With regulatory approvals pending, analysts project that the Riverbank–Pesapal ecosystem could add KSh 10–15 billion in new revenue by 2027. Looking ahead, KCB is targeting:
- AI-Driven Insights for predictive lending and fraud detection.
- Ethiopia Market Entry via a $100M+ bank acquisition, tapping into 120M potential customers.
- Deeper Visa/Mastercard Partnerships for SME-focused mPOS solutions.
Risks remain, such as cyber threats, competition from Equity Bank’s fintech arm, and regulatory complexity, but KCB’s balance sheet remains strong, with NPL ratios expected below 16% by year-end.
The Bigger Picture: Bank-Fintech Convergence Redefines East Africa
KCB’s fintech spree highlights a broader shift: standalone fintechs are aligning with banks to achieve scale, regulation, and credibility.
As digital transactions surpass 90% in urban Kenya, banks that control the underlying infrastructure will dominate the next phase of Africa’s financial evolution.
For investors, KCB’s stock (NSE: KCB) is already up 15% year-to-date, reflecting optimism around its digital growth story.
In Paul Russo’s words:
“We’re not just transforming banking; we’re transforming how people live, trade, and connect across Africa.”
KCB’s fintech bets on Pesapal and Riverbank may well define East Africa’s next financial frontier.
Pesapal Kenya: Simplifying Digital Payments Across Africa
Pesapal Kenya is a leading digital payments platform offering secure and convenient transaction solutions for individuals and businesses.
Through the Pesapal app, users can easily make payments, track transactions, and manage their accounts via the Pesapal login and Pesapal login password feature.
Businesses using Pesapal Openfloat benefit from real-time expense management and automated payment tools.
For enquiries or assistance, customers can reach Pesapal customer care through their official channels. The company also offers exciting opportunities via Pesapal careers, while transparent Pesapal pricing ensures affordability for merchants of all sizes.
Ronnie Paul is a seasoned writer and analyst with a prolific portfolio of over 1,000 published articles, specialising in fintech, cryptocurrency, climate change, and digital finance at Africa Digest News.
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