Brazil’s Ebanx Expands into Africa as CEO Says Worst of Crisis is Over

The fintech anticipates a strong digitization push in Africa over the coming decades, as is occurring in Latin America

Ebanx serves as a payment platform for for international companies in Latin America.
September 14, 2022 | 09:30 AM
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Mexico City — Brazilian payments technology fintech Ebanx is expanding operations outside Latin America into Africa, with its first markets on the continent to be South Africa, Nigeria and Kenya, the company announced during an annual Latin American business summit in Mexico City.

João Del Valle, CEO and co-founder of Ebank said in an interview with Bloomberg Línea that the company planned this decision years ago, and that now is the exact moment to execute it.

“The next decades are perhaps going to be incredible for the region, by 2050 a third of the world’s economically active adult population will be in Africa, and e-commerce will grow, so that’s where we’re going,” he said.


The arrival in Africa of the Brazilian unicorn valued at $1 billion is taking place in payment partnership with Pipefy, a low-code SaaS platform for workflow management founded in 2015 in Latin America and now operating in more than 200 countries around the world.

According to the report The Inflection Point: Africa’s Digital Economy is Poised for Takeoff, published in June by Endeavor, with contributions from McKinsey & Company, along with Egypt, the three African countries that Ebanx is focusing on first, South Africa, Kenya and Nigeria, account for 32% of the continent’s population, 51% of its GDP and 73% of the startup accelerators currently active on the continent.

Africa’s compound annual growth rate (CAGR) between 2010 and 2019 was higher than that of Europe and Latin America, the report states.

Del Valle believes this is the time for Africa, and which, he says, is reminiscent of a scenario similar to what Latin America experienced around 2012, when Ebanx began providing global merchants with access to sell more digital goods and services over the internet to Latin Americans using local payment methods. Ebanx currently has around 100 payment methods.


Today, the Latin American digital ecosystem has been strengthened thanks to companies such as Mercado Pago, Nequi, Ualá and Nubank, says Del Valle. “Around 31% of payments in the region are made through digital wallets,” he says.

Reaching Africa has its challenges, however. Del Valle says that among the challenges is to settle and adapt to a market that is 3,000 km away, “in addition to the cultural issues, there are regulatory challenges, each country has its different articulation of means of payment, currency exchange, and in addition the technological infrastructure for payments is not in the right place yet, although revolutions are also taking place and the acceleration is positive”.

The importance of the African market

According to the Endeavor report, there is currently a $115 billion digital economy in Africa thanks to a combination of a young, digitally savvy population, increased digital penetration and the impact of the Covid-19 pandemic.

“Africa is overflowing its growth potential. Digital adoption and consumption of online goods and services have accelerated rapidly in its countries, and investment capital has poured into the region,” according to Paula Bellizia, president of global payments at Ebanx.

The high level of mobile penetration and consumption in African countries positions the region as the “next frontier”. In Africa, mobile devices and digital money transfers are the foundation for banking access and financial inclusion for the continent’s huge population of more than one billion people.

Likewise, when it comes to the digital gaming market, Africa is the fastest growing in the world, according to Newzoo. It is currently a $2.6 trillion market, growing five times faster than the global average by 2022, and is expected to maintain a 10% annual growth rate through 2026. In addition, the streaming market in Africa, worth $1.9 billion today, is expected to accelerate by 14% annually through 2026.


Ebanx expands into Africa after adjustments

Earlier this year, when the startup capital crisis began, Ebanx was among the first to make adjustments and staff cuts.

The Brazilian company laid off 340 employees to focus on its core international payments business, it said in May of this year in a technology landscape undergoing a sharp and profound change within the difficult macroeconomic environment.

The Advent International-backed startup said at the time in a statement that it was restructuring parts of its business and that some projects would be eliminated.

Ebanx discontinued its Ebanx Go digital wallet product. And the layoffs will close down entire projects in different areas of the company, sources familiar with the matter told Bloomberg Línea.


However, Del Valle affirms that “perhaps the worst is over, we are still strong for 2023 in investments, in growth, although with a certain sensitivity in relation to the moment”.


The company founded in 2012 and with a presence in 15 countries in Latin America has been delaying its IPO planned for this year due to the environment of falling technology company shares.

The Brazilian company could seek a valuation in excess of $10 billion, as reported by Bloomberg News, but for now it is waiting for a more favorable environment in which to go public.

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