LAGOS, NIGERIA — Fintech company Onafriq is shutting down its Baxi agent banking business in Nigeria. The company cited rising costs, naira depreciation, and growing competition.
The announcement was made on Thursday. Onafriq said the decision was part of a strategic review of its operations.
Reasons for the Exit
Onafriq said the agent banking sector has become increasingly challenging. It said operational costs have risen sharply. The depreciation of the naira has also affected profitability.
The company said competition in the sector has intensified. Several fintech companies have entered the market. This has reduced margins.
“After a thorough review, we have decided to exit the agent banking business. This will allow us to focus on our core operations,” Onafriq said.
Baxi’s Operations
Baxi was one of Nigeria’s largest agent banking networks. It had thousands of agents across the country. The agents provided services such as cash withdrawals, transfers, and bill payments.
The closure will affect agents and employees. Onafriq said it would support affected staff. It also said it would work with agents to ensure a smooth transition.
Focus on Core Business
Onafriq said it remains committed to Nigeria. It said it would continue to operate its other businesses. These include cross-border payments and remittances.
“Nigeria is a key market for us. We will continue to invest in our core operations. We are not leaving the country,” the company said.
What This Means
The exit is a setback for the agent banking sector. Baxi was a major player. Its closure could leave a gap in the market.
It also highlights the challenges facing fintech companies in Nigeria. Rising costs and currency volatility are major issues. Companies must adapt to survive.
What Happens Next
Onafriq will wind down Baxi’s operations in the coming months. It will notify customers and partners. It will also provide support to affected agents.
For now, the company is focusing on its core business. It is also exploring new opportunities in Nigeria.
