Today marks a milestone I could never have anticipated but in hindsight seems so logical and invetable in that KCB Group announced it is taking a strategic minority stake in PesaPal. As someone who has followed PesaPal’s story since the early days, going back to 2009, and even sat down with founder Liko Agosta on my Pure Digital Passion Podcast a few years ago, I can’t help but feel a sense of pride and excitement! In this post, I’ll unpack PesaPal’s journey from its humble 2009 inception to this landmark deal in 2025, sharing insights from my conversations with Liko and reflecting on what makes this a win-win partnership for both PesaPal and KCB.

Born of Necessity: The 2009 Origins with a Travel Portal

Every great startup begins by solving a real problem. For PesaPal, that problem emerged in 2009 when Liko Agosta and his team built an East African travel portal. Back then, online payments in Kenya were nascent at best, and the travel site struggled to find a local payment gateway to process bookings. Liko recalls how they tried using global platforms (even Google’s payment product), only to have accounts shut down because providers couldn’t understand or trust payments flowing to an African travel businesss. Rather than give up, they decided to build their own payment solution — the seed of what would become PesaPal.

“Indeed, PesaPal only got its start in 2009 as a result of Liko and his team … needing a way of receiving digital payments for an East African travel portal they developed and could not find a simple and effective solution that worked locally in Kenya.”

In those early days, progress was slow. Liko shared with me that PesaPal’s very first year saw only 3 transactions processed on the new platform. But he wasn’t deterred. The turning point came in 2010 when an opportunity arose to power online ticket sales for Access Kenya. PesaPal built TicketSasa (then ticket.pesapal.com) for that project, selling 156 tickets in short order — a huge leap from near-zero and a validation of their concept. As Liko noted, “we thought the future was ticketing… Ticket.Pesapal.com became what is PesaPal today.” This early win ushered in a new era: PesaPal pivoted fully into payments, and Liko made it his sole focus from then on.

By 2011, PesaPal signed up its first e-commerce merchants (like deal platform Rupu, then Zuku the ISP), which helped them refine their processes and expand beyond Kenya. It wasn’t an overnight success story — far from it. Funding was scarce (it took them 10 years to secure a bank loan), and the company survived on revenues and a couple of angel investors in 2010–2011 (and summarily refunded when they clashed on the way they wanted to grow as a business). But in hindsight, Liko views the lack of easy venture capital as a blessing in disguise. It forced PesaPal to focus on sustainability and profitability rather than chasing vanity metrics. In our podcast conversation, Liko emphasized that profitability is the true north for him, not unicorn status. He famously quipped that many African fintech “unicorns” boast high valuations and PR buzz but are “loss-making… you have no profit. You are just market share.” PesaPal would chart a different path.

Founder Ethos: Playing the Long Game Without The Silicon Savannah Hype!

One thing that struck me in my podcast interview with Liko was his grounded, no-nonsense approach to business. “Liko is the type of founder and techie who likes to quietly put his head down and grind away at solving big business problems without the hype,” I wrote when introducing that episode. This ethos of quietly building and playing the long game defines PesaPal’s culture. Instead of burning through cash for growth at all costs, PesaPal prioritized understanding customer needs, building reliable technology, and earning revenue. In an era when fintech startups were raising astronomical funding rounds and chasing billion-dollar valuations, PesaPal was grinding its way to break-even and beyond.

This contrarian approach paid off. By focusing on retaining merchants and delivering value, PesaPal quietly amassed a large user base and achieved profitability (though Liko is too consservative to publicly reveal figures). As he noted, being profitable — however unglamorous it might seem next to unicorn hype — “is the holy grail of any business.” And it gave PesaPal options: they could grow on their own terms and consider strategic investments when the time was right, from a position of strength.

(Side note: It actually took me nearly two years to pin down Liko for that podcast! But the wait was worth it — our 2022 conversation unpacked how a Moi University dropout-turned-founder built one of East Africa’s leading fintechs with almost zero external funding. If you haven’t heard it, I highly recommend giving it a listen). 

Beyond Payments: Building A Fintech Ecosystem 

Fast forward to today, and PesaPal is no longer just a payment gateway — it’s an end-to-end fintech ecosystem. Over the past decade, the company has rolled out a suite of products and services catering to merchants large and small:

• Online Payments & E-Commerce: PesaPal’s core gateway lets businesses accept digital payments via mobile money (M-Pesa, Airtel Money), cards (Visa, Mastercard), and more. They’ve integrated these payments into custom solutions for key industries — notably travel and hospitality, which was PesaPal’s initial focus. Hotels and tour operators use PesaPal’s tools to get paid in local or international currency, and during the pandemic PesaPal even helped restaurant chains like Artcaffé stand up their own direct online ordering systems.
• ReservePort: This is PesaPal’s travel booking engine for hotels and lodges. It connects hotels’ property management systems to global distribution systems, enabling online reservations with seamless payments. Essentially, ReservePort gives hospitality businesses in East Africa a way to reach global customers and accept bookings (and payments) 24/7 — a natural extension of that original travel-portal idea from 2009.
• TicketSasa: Born from that early ticketing project, TicketSasa became a popular e-ticketing platform for events, concerts, travel experiences, and more. Even as PesaPal evolved, TicketSasa remained a key offering, demonstrating PesaPal’s knack for building vertical solutions on top of its payment rails. If you’ve bought a ticket for a major event in Nairobi in recent years, there’s a good chance PesaPal was powering the transaction in the background.
• Sabi POS: Perhaps PesaPal’s most visible product is the Sabi point-of-sale terminal — those sleek, Android-based card-and-mobile-money POS machines branded with the PesaPal logo that you’ve likely seen at cafes, supermarkets, fuel stations, and shops across East Africa. Launched a few years ago, Sabi terminals accept both card and M-Pesa payments on one device, streamlining in-person transactions. Sabi POS doesn’t just process payments, it also provides merchants with smart dashboards for reconciliation, sales reports, and fraud detection to help them “know” their business better. As I wrote in a blog post when PesaPal introduced SuperTap for Sabi, the goal is to make checkout as frictionless as possible — customers can even tap their smartphones on the Sabi machine to pay via M-Pesa (no need to key in till numbers or phone contacts). That kind of innovation, similar to Apple Pay but tailored for our African markets, demonstrates how PesaPal localizes global technology for African needs.
• OpenFloat: In 2023, PesaPal quietly launched an ingenious service called OpenFloat, aimed at business spend management. I stumbled upon OpenFloat when my own digital agency, Dotsavvy, was struggling to manage petty cash and expense reconciliations in a remote-work setup. Adopting OpenFloat “completely transformed how we handle business expenses,” allowing us to digitize payments for bills, supplier invoices, and employee reimbursements within one centralized system. OpenFloat basically turns PesaPal into a corporate expense platform — we load funds, our finance team disburses payments through a controlled app, and every transaction is tracked in real-time. It was such a game-changer that I ended up writing a detailed review of it last year. (Yes, PesaPal isn’t just for collecting money; it’s now helping businesses manage and spend money smarter. Talk about coming full circle!)
• Merchant Credit (PesaPal Credit): The newest feather in PesaPal’s cap is SME lending. PesaPal rolled out PesaPal Credit, a digital loan product that provides short-term working capital to merchants. What excites me about PesaPal Credit is that it leverages something unique in PesaPal’s arsenal: merchant sales data. Every payment a business accepts through PesaPal (be it via a Sabi POS or online) contributes to a rich data profile of that business’s turnover. PesaPal uses this transaction history to underwrite loans without requiring collateral. In other words, your daily sales become your credit score. This is revolutionary for small businesses that typically can’t access bank loans due to lack of traditional collateral. As PesaPal describes it, if you’re already running your sales through PesaPal, you’re already proving your creditworthiness. Thousands of Kenyan merchants have tapped into PesaPal’s pilot loan program in 2025, and it’s now expanding to Uganda as well. The introduction of merchant credit closes the loop for PesaPal — from payments to growth financing, they’re now an end-to-end partner for SMEs.

Looking at this lineup of offerings, it’s clear that PesaPal has grown into more than a payment processor. It’s a fintech platform or ecosystem deeply embedded in how East African businesses sell, transact, and now even borrow. This growth has been accompanied by geographic expansion since PesaPal operates in Kenya, Uganda, and Tanzania, with regulatory licenses from all three countries’ central banks, and aspirations to move into other African markets in the future.

35,000+ Strong: Sabi’s Ubiquitous Footprint Across East Africa

One of the most striking indicators of PesaPal’s impact is the sheer pervasiveness of Sabi POS terminals today. Quietly and without much fanfare, PesaPal built out a massive offline payments network. By late 2023, Pesapal had signed up over 30,000 merchant locations (many in hospitality) and deployed tens of thousands of Sabi machines, accounting for about 60% of all card/mobile money POS terminals in Kenya. Think about that: for every 10 point-of-sale machines in the country, 6 were Pesapal’s! This includes everything from the café where you tap to pay for coffee, to the boutique hotel swiping your card, to the local petrol station or corner kiosk.

As of 2025, that footprint has only grown — by our estimates, around 35,000 PesaPal Sabi POS terminals are now in the hands of businesses across Kenya, Uganda, and Tanzania. Essentially, PesaPal built a payments railway into the SME economy, one Android terminal at a time. These terminals not only process transactions; they also funnel invaluable data back to PesaPal’s systems (and now to PesaPal Credit’s algorithms). In a way, PesaPal has created a digital heartbeat of East African retail and hospitality — a heartbeat that a major bank like KCB can hear and leverage.

Walking into any number of shops in Nairobi today and in many others across East Africa, there’s a good chance I’ll spot that distinctive Sabi POS terminal on the counter. It’s a reminder that PesaPal’s technology isn’t just online or in theory; it’s physically present in our day-to-day commerce. This “last mile” presence is something few fintech startups achieve, and it’s a key reason KCB’s interest may have been stocked.

Why KCB Wants In: The Strategic Value of PesaPal’s Fintech Ecosystem & Data

So, why did KCB Group, Kenya’s largest bank by assets, decide to take a minority stake in PesaPal, now? In the public announcement on 31st October 2025, KCB stated the move is about “advancing innovative payment and financial solutions for Kenya’s small and micro enterprises (SMEs)”. In other words, KCB sees PesaPal as a gateway to the very market segment banks have historically struggled to serve — the micro-entrepreneurs, small shops, and gig-economy businesses that form the backbone of our economy.

Here are a few strategic angles to this deal:

• Embedded Finance Rails: PesaPal’s infrastructure (Sabi terminals, online gateway, integrations to mobile money, etc.) is like a digital railroad into thousands of SMEs. By investing in PesaPal, KCB effectively plugs into these rails. It can potentially integrate banking services (opening merchant bank accounts, facilitating settlements faster, offering insurance or overdrafts) directly within PesaPal’s platform. Instead of KCB trying to deploy its own POS machines or sign up small merchants one by one, it gains a partner that already has them in the fold.
• SME Data & Credit Scoring: As discussed, PesaPal captures rich transaction data from merchants. This data is a goldmine for financial services. It can inform credit scoring, detect trends, and identify which businesses are ripe for expansion. PesaPal has already begun exploiting this via PesaPal Credit’s data-driven loans. For KCB, which has a large lending business, such data can significantly de-risk SME lending. Instead of relying on collateral, KCB can leverage PesaPal’s models to extend financing based on cashflow. In effect, KCB gets access to a ready-made fintech credit engine tailored to SMEs — aligning perfectly with its strategy to boost SME offerings.
• Payments Volume & Fees: PesaPal processes hundreds of thousands of transactions a day. Bringing a bank into that flow could mean a share of transaction fees, or at least synergies in payment settlement. It’s an era where banks are keen on non-interest revenue, and digital payments provide just that. Moreover, KCB can route some of its existing merchants to PesaPal’s technology for better experiences, and vice versa.
• Regional Expansion & Ecosystem Play: KCB, with operations across East Africa, can help PesaPal accelerate expansion into new markets (leveraging KCB’s presence or regulatory clout), while PesaPal gives KCB a fintech brand under its wing to stay ahead of the curve. It’s no secret that banks have been feeling the heat from fintech disruptors. By aligning with PesaPal, KCB positions itself not as a victim of disruption but as a driver of innovation in the digital payments space. As one analysis noted, this deal effectively completes KCB’s fintech ecosystem strategy for SMEs — they now have a stake in the payment gateway that so many businesses rely on.

Most significantly, KCB is coming in as a minority investor, not an acquirer. This suggests a partnership approach rather than a takeover. PesaPal will continue to run independently, preserving the agility and culture that got it this far, but now with a heavyweight ally in its corner. The bank stated, “the investment sets the stage for the development of innovative payment and other related solutions for SMEs, enhancing value for shareholders of both PesaPal and KCB.” This demonstrates the win-win nature of the arrangement.

A Win-Win Deal: Fintech Agility Meets Banking Scale

From my perspective, the PesaPal–KCB deal is truly synergistic, as follows:

• PesaPal’s Win: Beyond the obvious influx of capital (which can fund product development, expansion into new African markets, and scaling credit issuance), PesaPal gains a prestigious strategic partner. KCB’s backing can open doors — be it with regulators, large enterprise clients, or cross-selling opportunities to existing KCB corporate customers who need payment solutions. Yet, because KCB is taking only a minority stake, PesaPal retains control over its vision and operations. Liko Agosta and his team will steer the ship, maintaining the innovative spark and entrepreneurial culture that a 16-year-old fintech needs. In short, PesaPal gets resources and reach without losing its identity.
• KCB’s Win: KCB, on the other hand, gets an inside track into fintech. Rather than build from scratch or acquire PesaPal outright (which can be costly and risky), KCB now has skin in the game and a seat at the table to influence PesaPal’s direction. They will benefit from PesaPal’s growth (financially, through their equity stake) and can jointly develop products that link banking and payments. For example, imagine KCB offering specialized merchant bank accounts or insurance through the Sabi POS interface, or using PesaPal’s platform to sign up SMEs for additional services. KCB essentially secures embedded access to thousands of retailers and businesses that frequent its banking halls far less than they use their PesaPal apps. It’s a smart way to remain relevant on the frontlines of digital commerce.
• SMEs & Consumers’ Win: Let’s not forget the end-users. This partnership could mean better services for merchants and consumers. We might see faster settlement of funds to merchant bank accounts (since KCB can streamline the back-end), new financing options at the point of sale (maybe a merchant can choose to get a KCB working capital loan offer right from their PesaPal dashboard), or even improved reliability and innovation as the two entities share knowledge. KCB’s investment validates that PesaPal’s mission of “powering businesses” is important for the economy, and we can expect more support for SMEs as a result.

In Kenya, we’ve seen several banks and fintechs start to collaborate in recent years, but this particular deal stands out because of PesaPal’s deep integration in everyday transactions. It reminds me a bit of partnerships in other markets where banks invested in payment processors or merchant acquirers to bolster their capabilities. The difference here is PesaPal’s end-to-end model — covering online, offline, and even lending — which gives KCB a unique all-in-one entry.

Looking Ahead: New Horizons & Another Coffee with Liko?

As I reflect on PesaPal’s journey — from a tiny travel-payments experiment that processed three payments in 2009, to a regional fintech leader attracting the interest of East Africa’s biggest bank — I’m struck by how full-circle this story is. PesaPal was born to solve a payments problem in travel; now it could be solving a financing problem for small businesses, with a bank by its side. The fintech landscape in Africa is maturing, and this kind of deal signals a future where collaboration trumps competition between banks and fintechs, all to the benefit of customers.

For Liko Agosta and his team, the real work begins now. Through KCB’s backing, PesaPal will be under pressure (and inspiration) to innovate even faster, expand to new markets, and perhaps even take on the big global players in this space. Knowing Liko, he will continue to “put his head down” and build — the same quiet determination that got him here will serve him well in the next chapter.

From my side, I’m certainly looking forward to seeing (and experiencing) the next wave of PesaPal innovations. Don’t be surprised if you soon find KCB-PesaPal co-branded services at your local kiosk, or new features on that Sabi POS ‘mama mboga’ is using. The rails are in place and the train is picking up speed!

Lastly, on a personal note, I’m excited to catch up with Liko again very soon — hopefully for a follow-up podcast episode on this milestone! I have so many questions: How did this deal come about? What new products can we expect when a bank and a fintech join forces? How will they navigate the regulatory aspects? And what does it mean for the broader fintech ecosystem in Kenya and East Africa? Consider this an open invite to Liko for a podcast to unpack PesaPal Version 2.0 — the story continues, and I’ll be right here to tell it.

Here’s to PesaPal’s remarkable journey so far, and to an even more impactful future ahead!