South African fintech plots major takover of Michael Jordaan’s Bank Zero in $60m deal

The deal, announced in July, is valued at approximately $60 million and involves a combination of newly issued Lesaka shares and up to $5 million in cash.

Bank Zero shareholders are expected to retain around 12% of Lesaka’s fully diluted shareholding. As part of the agreement, Jordaan will join the Lesaka board, while co-founder Yatin Narsai will take a role on the executive leadership team, with their shareholding subject to lock-up agreements ranging from 18 to 36 months.

“The commission is of the view that the proposed transaction is unlikely to substantially lessen or prevent competition in any market,” the Competition Commission said, adding that the transaction “does not raise significant public interest concerns.”

Bank Zero, founded in 2018 and officially launched in 2021, offers personal and business banking services through a secure, app-driven platform.

Despite launching amid the financial turbulence of the Covid-19 pandemic, the bank has grown to more than 40,000 funded accounts and holds deposits exceeding $22 million. Its niche lies in providing low-cost, technology-enabled banking solutions that appeal to both underserved and tech-savvy clients.

Jordaan’s influence has been central to Bank Zero’s profile. Known for spearheading FNB’s digital transformation, he has built a reputation in South Africa’s financial sector as an innovator and investor in tech-driven start-ups.

“It was a meeting of minds,” Jordaan reflected on his partnership with Narsai, the former head of IT and Retail Banking at FNB.

Narsai identified the Mutual Banking licence as a cost-efficient route to launch the venture and assembled a team essentially comprising former FNB staff.

Lesaka, owned by Lesaka Technologies, has a history of providing low-cost financial services to underbanked South Africans, including transactional accounts, microloans, insurance, and payment processing services.

Ali Mazanderani, Lesaka’s chair, described the acquisition as a “transformative event,” noting it embeds a “trusted, well-engineered neobank capability into Lesaka’s fintech platform.”

The strategic rationale for the deal is clear: Lesaka plans to cross-sell banking services to its existing South African customer base, leveraging Bank Zero’s digital infrastructure and brand recognition.

For Bank Zero, the merger represents a new chapter, combining its tech expertise with Lesaka’s financial reach and resources.

With regulatory approval now secured, both companies are poised to finalise the transaction and usher in a new era for one of South Africa’s most innovative digital banks, signalling a further evolution in the country’s fintech landscape.