Six years after Stripe, Paystack is learning to keep money

After Stripe bought Paystack for $200 million in 2020, Paystack expanded beyond online checkout. It entered Côte d’Ivoire, Ghana, Kenya, Nigeria, and South Africa, while gaining approvals in Egypt and Rwanda. It also hired internationally and built products for bank transfers, shops, consumers, and businesses.

That growth changed its economics. Payment fees arrive only when transactions happen, while money held in accounts can support deposits and lending. Paystack’s Virtual Terminal routed transfers into Paystack-Titan accounts, but Titan kept the interest. Paystack then bought Brass, launched Zap, and acquired Ladder Microfinance Bank.

The transformation also brought problems. Falling currencies reduced dollar revenue, while Zap was fined because its wallet-like operation exceeded Paystack’s payments licence. By January 2026, Paystack had created The Stack Group, bought a bank, and said its payment volume had grown more than twelvefold since 2020.

Paystack expanded geographically and financially after Stripe’s acquisition. It now serves businesses in Côte d’Ivoire, Ghana, Kenya, Nigeria, and South Africa. It also has approvals in Egypt and Rwanda, showing that its reach extends beyond the countries where it was already operating.

The clearest scale measure is payment volume. Paystack said volume had grown more than twelvefold since 2020. Its customer base stood at 60,000 when Stripe agreed to buy it, but the article does not provide a newer customer number. That means volume, rather than customers, is the strongest stated measure of expansion.

The growth came with greater exposure. Bank transfers rose to 34% of Nigerian payments in 2023, from 12% in 2021. Paystack also hired abroad and opened an engineering hub in Dubai. But dollar costs rose against weaker local currencies, forcing 33 layoffs in Europe and the UAE.

A payments company helps money move between other people’s accounts. Its revenue usually comes from transaction fees, and its payments licence does not automatically allow it to hold customer balances. This model is useful, but it depends on money moving.

A wallet lets customers keep money in an account or balance and spend it later. The article says holding money, even briefly, requires a different licence. A bank goes further: its licence allows it to take deposits, lend, and earn interest. Paystack’s Zap looked like a wallet, although Paystack initially held only a payments licence.

That distinction had a direct consequence. In April 2025, Nigeria’s central bank fined Paystack ₦250 million over Zap’s operation. Zap later received approval. In January 2026, Paystack bought Ladder Microfinance Bank, giving it a route to deposits and lending through Paystack MFB.

Paystack earns a percentage when businesses collect payments. That revenue is tied to local transaction values and local currencies. When those currencies lose value against the dollar, the same number of local-currency transactions converts into fewer dollars.

The article gives two examples. By November 2023, the naira had lost more than half its value since June. The Kenyan shilling had fallen almost 20% in twelve months. Paystack could process more payments in those markets, yet the dollar value of what it earned from them could still shrink.

The problem became larger as Paystack expanded. It hired internationally and faced costs in dollars while earning in weaker African currencies. That pressure led to 33 layoffs in Europe and the UAE. Currency weakness therefore made growth less valuable to a company that measured some costs and performance in dollars.

A payments company earns when it processes a transaction. If customers stop moving money, that fee income stops. Deposits are different because balances can remain in accounts between transactions. A bank can use those deposits to support lending or investing and earn interest over time.

The article contrasts Paystack’s fee model with Nubank. Nubank ended 2025 with $41.9 billion in deposits, paid 87% of the interbank rate to fund itself, and made $2.9 billion. Worldwide, interest represented 46% of payments revenue in 2024, according to McKinsey. These figures show why balances can become a major income source.

Paystack’s Virtual Terminal created accounts carrying its name, but Titan Trust Bank received the interest. Buying Ladder Microfinance Bank changed that possibility. Paystack MFB can take deposits and lend, so the group can earn more from customer balances instead of relying only on payment fees.

Paystack was moving from payments into businesses that hold money, issue cards, and lend. Buying existing companies provided a faster path than creating every product and operating structure internally. It also helped Paystack assemble The Stack Group around payments, banking, and consumer services.

The deals served different purposes. Brass brought business-banking customers and showed Paystack the danger of deposits running short. Allawee added a card business, and its customers were later directed into Paystack accounts. Ladder Microfinance Bank supplied the licence needed for Paystack MFB to take deposits and lend to businesses first, then individuals.

The acquisitions did not remove the hard work. Brass closed as a standalone business and moved customers into Paystack MFB. Allawee customers had to open new accounts after its closure was announced. Paystack still must integrate these businesses while earning trust and meeting regulatory requirements.

A bank can receive deposits, pay depositors a funding cost, and use the money for lending or investing. If the income from those activities exceeds what the bank pays for deposits and its operating costs, the difference supports profit. This income can continue while balances remain, unlike a one-time payment fee.

Nubank illustrates the mechanism. It ended 2025 with $41.9 billion in deposits, paid 87% of the interbank rate to fund itself, and made $2.9 billion. Paystack’s earlier Virtual Terminal accounts carried its name, but Titan Trust Bank received the interest. A bank licence would let Paystack capture more of that economics.

The model depends on trust because customers must keep money in the institution. It requires regulation because taking deposits and lending are licensed activities. It also needs steady deposits: without enough balances, the bank has less funding. Brass’s withdrawal problems and reported ₦2 billion hole showed what happens when deposits and confidence fail.