Fintech group Lesaka Technologies announced that it will acquire Bank Zero for R1.1 billion pending regulatory approval.

Bank Zero was founded in 2018 by Michael Jordaan, a former CEO of FNB.

In the announcement made on Friday morning by Lesaka, the acquisition will be settled through a combination of newly issued shares, such that the shareholders of Bank Zero will own approximately 12% of Lesaka’s fully diluted shares at the time of completion of the proposed transaction and up to R91 million ($5.1 million) in cash.

“The proposed transaction is subject to the satisfaction of customary closing conditions as well as regulatory approvals ordinarily required of a transaction of this nature, including approval from the Prudential Authority, a division of the South African Reserve Bank, Competition Commission approval and Exchange Control approval,” it said.

The fintech group said this acquisition will mark another key milestone in its journey to build a vertically integrated fintech platform. Lesaka Technologies is listed on the Johannesburg Stock Exchange (JSE) and on Nasdaq.

“The combination of Bank Zero’s digital banking infrastructure and its operational banking licence, together with Lesaka’s fintech and distribution platform, is intended to transform the way Lesaka is able to conduct business in the future, offering key financial, strategic and regulatory benefits,” Lesaka said.

Lesaka expects the transaction to support a more optimised balance sheet in the future, allowing the group to finance existing and continued growth in lending books through customer deposits, driving stronger lending unit economics.

“As at the end of April 2025, Bank Zero had a deposit base in excess of R400 million and more than 40 000 funded accounts across South Africa,” read the announcement.

Lesaka expects the transaction to be accretive to its shareholders, with Bank Zero expected to be profitable in the fiscal year following completion of the transaction.

“Our belief in the combined platform’s future is clear and we see strong symmetry in our vision. There is a strong international precedent for fintechs that have acquired banking capabilities to deliver more integrated, compliant and capital-efficient financial services,” Jordaan said.

The announcement also includes changes to the Lesaka board. Jordaan will join the Lesaka board of directors, while Yatin Narsai will continue as CEO of Bank Zero.

Narsai, CEO and co-founder of Bank Zero, spent more than 15 years at FNB, where he served as the CEO of FNB’s retail bank.

“The broader Bank Zero leadership team will remain in their current roles, ensuring continuity and integration,” he said.