Traction Apps, a top payment solutions provider for small merchants in Nigeria, has agreed to be acquired by OmniRetail, which was named Africa’s fastest-growing company by the FT Rankings 2024. This acquisition represents a major advancement in OmniRetail’s objective to support trade solutions and financial services for small and medium-sized businesses (SMEs) in Africa’s fast-moving consumer goods (FMCG) value chain.
Since 2019, OmniRetail has been tackling the issues that SMEs in the FMCG sector encounter. In 2022, the company introduced OmniPay, a smooth payment platform that connects with 13 financial service providers to facilitate supplier payments and collections. OmniPay provides underserved merchants with the funding they require for expansion by using transaction data to create creditworthiness assessments.
Mayowa Alli and Dolapo Adejuyigbe launched Traction Apps in 2020, and since then, it has expanded to service over 100,000 retailers by providing a one-stop platform that incorporates retail software solutions, loans, and payment acceptance. By integrating Traction’s merchant point-of-sale services into OmniPay’s current ecosystem, this acquisition will enable Omni to improve the financial platform available to shops.
According to Deepankar, CEO of OmniRetail: “This acquisition is a testament to the synergies we’ve built with Traction. What started as a partnership to integrate Traction’s POS into OmniPay for card payments has grown into a full merger. Together, we will simplify payments, credit access, and loyalty solutions for retailers and SMEs, helping them thrive in an increasingly digital market.”
According to Mayowa Alli, Co-founder of Traction: “This integration will allow us to scale our solutions and accelerate our vision of simplifying payments at the retail level. OmniRetail’s ecosystem will enable us to bring our innovative solutions to a wider audience, benefiting even more small businesses across Nigeria and beyond.”
Continuing, another Traction Co-founder, Dolapo Adejuyigbe, said: “Building Traction has been about empowering small businesses to grow and thrive. Now, as part of OmniRetail, we will become the leading growth partner for SMEs across Nigeria, offering a more comprehensive platform than ever before.”
BrandSpur business and economy news reports that by providing a uniform platform that facilitates access to financial resources and boosts operational efficiency, this purchase furthers OmniRetail’s ultimate goal of bridging the gap between retailers and financial services.
Strategic Justification:
· Traction’s services enhance OmniPay’s current portfolio, providing SMEs in the FMCG industry with a comprehensive solution. Customer satisfaction, service delivery, and differentiation from other fintech firms will all be improved by the unified platform.
· Traction is well-represented in retail, supermarkets, restaurants, fashion stores, and electronics—all of which account for 70% of Traction’s merchants and are ideal for Omni’s clientele.
· By combining the systems, OmniRetail and Traction will increase profitability while cutting expenses, giving merchants a more effective service model.
Effect on the Market:
· As a leader in the FMCG industry, the combined company will now serve 160,000 clients in the wholesale and retail sectors.
Growth and Financial Metrics:
Over ₦2 trillion will be processed by the new organization each year, and loans totaling ₦200 billion will be facilitated.
Team synergies and leadership:
With an emphasis on expanding OmniPay, integrating solutions, and advancing product development, the founding team of Traction will become part of OmniRetail’s executive team.
According to OmniRetail’s Chief Innovation Officer, Dika Oha: “Their expertise in fintech infrastructure, combined with our retail knowledge, will drive innovation and growth.”
Benefits for Customers:
Consumers will have access to a wide range of services, such as quicker loan approvals, payments, and a wider range of financial products in emerging markets.
Support from Stakeholders and Investors:
· P1Ventures, Consonance, and Ventures Platform are Traction’s main investors.
· Venture Platform, a significant investor in Traction and OmniRetail, was crucial in making this partnership possible. According to Venture Platform Partner Dotun Olowoporoku: “We believe in leveraging the strengths of our portfolio companies to create more robust solutions. This acquisition is a major step forward in building more comprehensive offerings for African SMEs.”
Timeline & Next Steps:
· The acquisition will be carried out in stages, with platform integration being the primary focus after the Omnipay and Traction teams are integrated. By the end of Q1 2025, Traction and OmniPay will be fully integrated, and clients will soon be able to make use of the improved services.
Details of the transaction:
· Neither of the clubs provided any information when questioned about the transaction value. However, according to Archit, OmniRetail’s Head of Investments: “The acquisition is structured as a part equity and part cash deal, allowing Traction’s investors and stakeholders to benefit from OmniRetail’s (combined entity’s) growth.”
