The Competition Commission has granted approval for Lesaka Technologies to acquire Bank Zero, the app-only digital bank co-founded by former FNB CEO Michael Jordaan. The Commission recommended that the Competition Tribunal approve the transaction without conditions, signaling confidence that the deal will not negatively impact market competition.
Under the proposed transaction, Lesaka will acquire Zero Research, the holding company that owns Bank Zero, a mutual bank incorporated under South Africa’s Mutual Banks Act. The acquisition, valued at R1.1 billion, will be funded primarily through newly issued Lesaka shares and up to R91 million in cash. Following completion, Bank Zero’s shareholders will hold approximately 12% of Lesaka’s fully diluted shares.
As part of the agreement, Michael Jordaan will join Lesaka’s board, while Yatin Narsai, Bank Zero’s CEO and co-founder, will join the executive leadership team. Their shareholding will be subject to lock-up agreements ranging from 18 to 36 months.
Lesaka Chair Ali Mazanderani described the deal as a “transformative event”, embedding a trusted, well-engineered neobank capability into Lesaka’s fintech platform. The acquisition is expected to enable Lesaka to cross-sell banking services to its existing customer base, strengthening its position in South Africa’s financial services market.
Founded in 2018 by banking veterans Michael Jordaan and Yatin Narsai, Bank Zero officially launched in 2021 as an app-only digital bank offering personal and business banking services, including transactional and cash investment accounts. Despite launching during the challenging COVID-19 era, the bank carved out a niche in the market, leveraging its secure, tech-driven platform and low-cost banking model.
At last reporting, Bank Zero had over 40,000 funded accounts and more than R400 million in deposits, alongside proprietary technology that underpins its competitive edge.
Lesaka Technologies, incorporated in the United States, provides financial technology solutions to underserved consumers and small businesses. In South Africa, it offers low-cost financial services such as transactional accounts, insurance, micro-loans, payment processing, and transaction switching. The acquisition of Bank Zero aligns with Lesaka’s strategy to deepen its footprint in the banking sector and expand its product suite for unbanked and underbanked customers.
The Competition Commission concluded that the transaction is unlikely to substantially lessen or prevent competition and does not raise significant public interest concerns. With regulatory approval secured, the companies are now one step closer to finalizing the deal and ushering in a new era for Bank Zero under Lesaka’s ownership.
