Onafriq Shuts Down Baxi Agent Banking Business in Nigeria

Pan-African fintech Onafriq has closed its Nigerian agent banking business, Baxi, after a strategic review found the cash-based operation commercially unsustainable. The company will maintain its Nigerian presence through payment services and card issuing operations.

The decision ends a business expansion that began in 2021, when Onafriq, then operating as MFS Africa, moved to acquire Capricorn Digital Limited, the company behind Baxi. The transaction was completed in March 2022 following approval from the Central Bank of Nigeria.

Onafriq had invested in expanding Baxi’s agent network, which provided cash withdrawals, money transfers, bill payments and account-opening services. However, rising operating costs and changes in how Nigerians make payments weakened the business case for maintaining the network.

Inflation and Digital Payments Pressure Baxi

Nigeria’s economic conditions became increasingly difficult for agent banking operators from 2024. The naira’s depreciation and high inflation raised operating expenses while putting pressure on transaction volumes.

At the same time, instant bank transfers gained ground, reducing demand for some cash-in and cash-out services provided by point-of-sale agents. Competition among agent banking providers added further pressure on margins.

These conditions left Onafriq reassessing whether Baxi’s offline model could deliver sustainable returns. The company concluded that the operation was no longer commercially viable.

Onafriq Acknowledges the Setback

Onafriq founder and chief executive officer Dare Okoudjou acknowledged that the company had not achieved the results it expected in Nigeria.

Okoudjou described the closure as a difficult decision, particularly for employees, agents and business partners connected to the operation. He said the company would manage the transition with fairness and continue to meet its commitments to affected stakeholders.

The closure marks a setback for Onafriq’s efforts to expand through physical agent networks in Nigeria, where access to cash and financial services has supported the growth of agency banking.

Agents and Employees Enter Transition Process

Onafriq said agents operating through the Baxi platform have been transitioned to another principal bank. Customers were also advised to transfer their funds within a 30-day period.

Employees whose positions are directly linked to the agent banking business are undergoing consultation, with transition support planned for those affected.

The company said it would provide guidance during the process and work with stakeholders to manage the closure.

Onafriq Retains Its Nigerian Payments Business

The shutdown is limited to Baxi’s agent banking operations and does not signal Onafriq’s withdrawal from Nigeria. The company will continue operating through its Payment Solution Service Provider licence and card issuing infrastructure.

Onafriq’s remaining business will focus on payment services and its wider network connecting financial institutions, businesses and payment providers across African markets and beyond.

The change shifts the company’s Nigerian strategy away from running a capital-intensive physical agent network and towards payment infrastructure and cross-border transactions.

Baxi’s Place in Onafriq’s Expansion

Founded in 2014, Baxi had built a network of more than 90,000 agents before Onafriq’s acquisition. The platform gave consumers and small businesses access to everyday financial services, including cash withdrawals, transfers and bill payments.

Onafriq acquired the business to strengthen its reach in Nigeria and connect local payment activity to its wider African network. The closure shows the difficulty of sustaining that model as economic pressures increase and consumers adopt faster digital alternatives.  

Onafriq has confirmed that Baxi’s agent banking operations will close, while its payment services and card issuing business in Nigeria will continue. The transition includes moving agents to another principal bank and giving customers 30 days to transfer their funds.