Lesaka dumps dead weight and flexes fintech muscle with a one-brand strategy

Lesaka is shedding skin like a desert snake and stepping into a brighter, lime-green future. The fintech group has trimmed away what its CEO calls non-core businesses, simplified its structure, and is preparing to put a single name on the shop window and the stock exchange board alike.

The message from CEO Lincoln Mali is clear: The clean-up phase is largely done. The build phase has begun.

Commenting on the results, Lesaka chairperson Ali Mazanderani said, “I am delighted that for the first time since the creation of Lesaka in 2022, we have delivered a positive net income and have met our guidance for the 14th consecutive quarter.

Although revenue dipped 3% to R3.06-billion, net revenue rose 16% to R1.6-billion and group adjusted Ebitda (earnings before interest, tax and depreciation) climbed 47% to R304.5-million, bolstered by operating income more than tripling to R37-million.

In an early morning interview, Mali told Daily Maverick the tale of a multiyear turnaround that is translating into positive net income and midpoint profitability guidance, with momentum driven by sharper focus and tougher choices about what not to keep. Central to that strategy has been sunsetting four businesses that no longer fit Lesaka’s long-term model.

“We’ve been able to sunset a number of businesses that were not on core or key parts of our strategy,” said Mali. He pointed specifically to:

• A hardware sales business: A unit focused on selling devices and hardware, which did not fit the higher-margin fintech platform strategy.
• SIM card business: A distribution operation dealing in SIM cards, considered non-core to Lesaka’s long-term fintech and financial services focus.
• POS device repair operation: A technical support and repair business for point-of-sale devices.
• A bank-linked POS support business: The POS repair/support activity tied to a previous bank partner arrangement, which Lesaka exited along with the broader support function.

These units, while once part of the broader group, did not align with the higher-margin, platform-led fintech ecosystem Lesaka is trying to build.

The results already show three very different engines running at different speeds.

The consumer division has surged from a loss-making position several years ago to what Mali calls “sterling performance”, with growth in accounts and strong cross-selling of loans, insurance and value-added services such as airtime and data.

The enterprise unit, meanwhile, has swung into profit, supported by in-house transaction processing and the integration of acquired platforms such as Recharge. Merchant operations are softer for now, but that is by design, not neglect.

The merchant segment is undergoing its own internal renovation. Four previously acquired businesses are being fused into a single operating structure with new leadership, unified systems and streamlined infrastructure. Mali signals a roughly 18-month integration runway, with flatter performance expected in the near term and stronger growth targeted from the 2027 financial year.

Brand unification

The second major pillar of the strategy is brand unification.

Until now, Lesaka has largely been a holding company name, visible to investors and analysts but mostly invisible to customers and merchants interacting with its various subsidiaries. That is changing. The group is consolidating multiple legacy brands under one banner and pushing Lesaka forward as the customer-facing identity across consumer and merchant markets.

“We’re sunsetting all of the old brands and building everything around the Lesaka brand,” said Mali. “Up to now, that brand was only for investors and stakeholders. Today, it will be visible to customers. It will be visible to merchants.”

Mazanderani said the company is building a connected ecosystem that mirrors how people live, earn and spend.

“We’re disrupting the product bundle, the route to market and the service experience. Our focus is on creating the market that should be, on working with our customers to change the status quo. On being there with them on every step of the journey,” he said.

The commercial logic is straightforward. A single brand makes it easier to bundle solutions and deepen relationships. A restaurant client that once bought only software from one Lesaka subsidiary can now be offered payments, acquiring, lending and value-added services under one integrated pitch. A fuel station using a Lesaka cash vault can be layered with card acceptance, airtime sales and working capital loans based on transaction data. Each additional product increases customer lifetime value and improves unit economics.

The tech that holds it all together

Technology modernisation lies beneath this cross-sell machine. Lesaka has invested heavily in a new platform called Unity, designed to replace older systems and give merchants richer functionality and better data. Revenue may be lower upfront under the new subscription structure, but the group expects stronger lifetime returns and broader product attachment over time. Major clients, including large restaurant groups, are already being migrated on to the platform across multiple markets.

Parallel to the tech overhaul is a finance function rebuild. Mali notes that as Lesaka acquired multiple businesses, it inherited uneven control environments and spreadsheet-heavy processes. Under the current CFO, the group is implementing new finance and payments systems aimed at near real-time visibility and tighter controls, partly in response to past indirect tax corrections that required remediation and penalties.

The company had determined that certain indirect taxes had not been accounted for correctly in previously filings going back to June 2022, because amounts were incorrectly claimed in monthly indirect tax submissions and incorrectly excluded from expenses in the financial statements.

Shareholders have been advised that the company may be liable for penalties and interest on indirect taxes not paid on time; however, the financials were not materially misstated.

The Bank Zero acquisition

The pending Bank Zero acquisition, now cleared by competition authorities and awaiting final regulatory approval, is the next planned booster stage. Mali says bringing a bank onto the platform would lower funding costs for Lesaka’s lending books, enable deposit-funded credit and accelerate technology modernisation, while Bank Zero’s leadership remains in place and becomes equity-aligned with the broader group.

From the outside, it looks like a portfolio pruning followed by a brand and platform bloom.

The dead wood has been chopped. The trunk has been repainted lime-green. Now Lesaka wants customers and merchants to recognise the name on every branch. DM