Pan-African fintech Onafriq has confirmed the closure of its Nigerian agent banking division, which operates under the widely known Baxi brand. The decision follows a strategic review that found the offline agency model commercially unsustainable amid Nigeria's changing economic and payments landscape. The company stressed that the move does not represent an exit from Nigeria, as its payment services and card issuing operations will continue.
Strategic Exit from Agent Banking
The retreat closes a chapter that began in 2021, when Onafriq, then known as MFS Africa, acquired Capricorn Digital Limited, the operator of Baxi. The group invested heavily in the business through 2023 to expand its offline agent network and promote financial inclusion across Africa's largest economy. However, the operating environment deteriorated sharply from 2024, forcing a reassessment of the unit's long-term viability.
Economic Pressures and Shifting Consumer Habits
The sharp depreciation of the naira and surging inflation increased operating costs while eroding transaction volumes across the Baxi network. At the same time, the rapid adoption of instant account-to-account bank transfers reduced demand for cash-in and cash-out services offered by point-of-sale agents. A crowded agent banking market compounded the problem, driving margins to levels that the company described as unsustainable.
Leadership Acknowledges the Setback
Dare Okoudjou, founder and chief executive officer of Onafriq, acknowledged that the company did not achieve the outcome it set out for in Nigeria. "We entered Nigeria with conviction and commitment," Okoudjou said, adding that closing the business was a difficult decision affecting colleagues, agents, and business partners. He stressed that the company remains committed to honesty, fairness, and a well-managed transition, with Nigeria remaining central to its mission.
Transition Measures for Stakeholders
Agents onboarded through the Baxi payments platform have been transitioned to another principal bank, while customers were advised to transfer their funds within a 30-day window. Employees whose roles are tied directly to the agent banking business are undergoing consultation and will receive transition support. Onafriq said its teams are available to provide guidance and will continue to honor commitments to affected stakeholders during the transition.
Nigeria Focus Shifts to Cross-Border Payments
The shutdown is strictly isolated to the Baxi agency business and does not mark a full exit from the Nigerian market. Onafriq will maintain its presence through its Payment Solution Service Provider license and its card issuing infrastructure. By shutting down its capital-intensive point-of-sale operations, the company aims to streamline its focus on connecting domestic payment systems to its broader cross-border network across Africa and beyond.
Baxi's Role and Onafriq's Entry
Onafriq entered Nigeria's agent banking market in 2021 by agreeing to acquire Capricorn Digital Limited, which operated Baxi, and completed the transaction in March 2022 after receiving approval from the Central Bank of Nigeria. Baxi was founded in 2014 and had built a network of more than 90,000 agents before the acquisition, offering cash withdrawals, money transfers, bill payments, and account opening. The network was intended to complement Onafriq's broader African payments infrastructure and connect Nigerian businesses to regional markets.
The closure of Baxi underscores how quickly macroeconomic shifts and digital adoption can reshape the viability of offline payment models in Africa's largest economy. Onafriq's decision reflects a broader industry trend as instant bank transfers and mobile channels continue to displace cash-heavy agent networks. By redirecting resources toward its cross-border payments engine and card issuing services, the company is betting on a more scalable path to long-term growth in Nigeria.