KCB Group, Kenya’s largest lender by assets, has agreed to acquire a minority stake in digital payments company Pesapal as it accelerates its fintech pivot. The deal, announced in a notice dated October 31, is subject to regulatory approval from the Central Bank of Kenya and other authorities. While the value of the stake was not disclosed, the move highlights KCB’s intent to control more of the infrastructure that powers payments across East Africa.
Strategic shift toward platform banking
The Pesapal transaction is KCB’s second fintech deal in 2025, after its purchase of a 75 percent stake in Riverbank Solutions earlier in the year. Riverbank, a Nairobi based payments firm, builds revenue collection, agency banking, and payments systems for banks, government entities, and retailers in several East African markets. Together, the Riverbank and Pesapal investments signal KCB’s transition from a traditional credit focused bank into a platform based financial services provider built around payments and data.
Who Pesapal serves
Founded in 2009 by entrepreneur Agosta Liko in Nairobi, Pesapal is one of East Africa’s leading digital payment service providers. The company holds a payment service provider license from the Central Bank of Kenya and processes millions of transactions every month. It enables thousands of merchants across Kenya, Uganda, and Tanzania to accept card and mobile money payments both online and in store.
Payments and merchant solutions
Pesapal’s technology integrates major payment methods such as Visa, Mastercard, American Express, and M Pesa, alongside point of sale and e commerce tools. Its platform supports sectors ranging from hospitality and education to transport and professional services, making it a key enabler of regional commerce. By adding Pesapal’s merchant acquiring capabilities, KCB aims to deepen its role in small and micro enterprise payments while extending its existing agent and merchant network.
Building a full stack fintech ecosystem
KCB’s investment in Riverbank gave the bank access to distribution rails through agency banking, revenue collection platforms, and SME business management tools. The Pesapal deal now layers in a payment gateway, online and in person merchant acceptance, and digital credit solutions for MSMEs. This combination positions KCB to build what it describes as a full stack financial services platform that offers not only lending, but also the infrastructure businesses need to operate digitally.
Betting on payments growth
Under the leadership of chief executive Paul Russo, KCB has made payments a central pillar of its digital transformation agenda. Russo has argued that payments in the region are expected to post the fastest growth within financial services, creating room for banks to innovate around embedded finance and data led products. By investing in the pipes that move money rather than just balance sheet lending, KCB is aligning itself with this shift in how financial services are delivered.
Financial performance underpins expansion
The pivot toward fintech investments comes on the back of strong financial results. KCB’s profit after tax for 2024 rose 64.9 percent to KES 61.8 billion ($477.9 million), supported by broad based revenue growth. Non interest income increased 16.5 percent to KES 67.5 billion ($522 million), with foreign exchange trading and digital transactions providing a significant boost.
Regulatory outlook
Completion of the Pesapal transaction will depend on approvals from the Central Bank of Kenya and other regulators. Authorities will review the deal’s implications for competition, financial stability, and consumer protection in an evolving payments market. If cleared, the investment would further blur the lines between banks and independent payment providers as digital commerce expands across the region.
KCB’s planned minority stake in Pesapal marks a step in KCB’s evolution into a platform oriented financial services player. By combining Riverbank’s distribution rails with Pesapal’s merchant and e commerce capabilities, the bank is constructing an integrated payments and banking stack for East Africa’s businesses. Backed by strong earnings and digital usage, the strategy positions KCB to play a key role in the region’s next phase of financial innovation.