Nigerian fintech startup, Kippa, recently announced the withdrawal of its offline payments product, KippaPay, from the market. The move, which surprised many industry insiders, was explained by the company's leadership as a strategic response to a rapidly changing economic landscape in Nigeria.
Kippa's co-founder and CEO, Kennedy Ekezie, told WT that the decision to retire KippaPay was driven by a confluence of economic factors. Over the past 18 months, Nigeria experienced a significant uptick in the cost of doing business as currency depreciation and inflation battered local enterprises.
“We decided to pull this product back from the market for profitability reasons. Our projections changed significantly in the past 6 months due to the changes in the macroeconomic conditions in Nigeria,” Ekezie told WT.
“These past two quarters, the cost of doing business in Nigeria went up significantly and 9 percent of our customers shut their business down in the past 3 months,” he shared.
Kippa, which since 2020 has provided banking services and finance management software to small businesses, launched KippaPay having obtained a Super Agent License in Nigeria last September.
The product, which supported merchants with offline payments and agency banking through its POS terminals, had made inroads into the Nigerian market over the past 18 months, notably in a segment that has become as competitive as it has been lucrative. Some NGN 1.15 T (~USD 1.4 B) went through merchant POS transactions in Nigeria in March 2023, according to data cited by BusinessDay.
With KippaPay, Kippa joined prominent banks and established fintech challengers such as Moniepoint and OPay—with a distribution of agents and POS devices amounting to millions between them—as notable players jostling for places in the space.
