Lesaka gains social grant clients

Fintech company Lesaka says it now has 13% market share among social grant recipients and plans to grow this to 20% in the next three-five years.

Lesaka, which rebranded from Net1 UEPS three years ago, said in its results for the third quarter of financial 2025 that its Easypay Everywhere (EPE) platform added 89,000 new customers in the period to end-March.

EPE now has 1.9-million customers, of whom 1.7-million are social grant recipients. However, revenue share is less than 7% of the R25bn annual revenue opportunity in this market. 

Lincoln Mali, CEO of Lesaka Southern Africa, said the company is taking market share from some traditional banks.

“Operational challenges at Post Bank, particularly around expiring Sassa [South African Social Security Agency] cards, led many of their customers to seek alternative banking providers. We changed our technology to make it quick and easy to open an account, and give you a card in minutes. So when [competitors] are facing challenges, we are quick to respond when people want an alternative Lincoln Mali, CEO of Lesaka Southern Africa “Our strong brand and extensive distribution network enabled us to capture a significant share of this migration ... and this contributed meaningfully to our market share gains,” Mali said. 

Mali, who joined the company four years ago prior to the rebranding, said the group had made significant changes to position it for growth.

“We changed our distribution. We now have branches that look like bank branches. Our card now looks like the card of any other banking institution.

“We changed our technology to make it quick and easy to open an account, and give you a card in minutes. So when competitors are facing challenges, we are quick to respond when people want an alternative,” Mali said.

He said Lesaka was better equipped “than the other financial institutions” to serve the social grant customer base. EPE provides a range of services including bill payments, airtime and electricity vouchers, insurance and loans. Sales of insurance policies rose 27% to 527,671. 

Mali said “every aspect of our product suite is designed with these customer in mind. We begin the cycle by helping them receive their money and deposit funds with us, help them manage their money and enable them to make payments. Since we can see their spending activities we use this data to underwrite short to medium term loans.”

Lesaka’s loan book has grown 59% year on year to R808m. 

Mali said Lesaka is the only regulated credit provider for this consumer segment.

“We changed the terms of the loan products,” he said, because customers had asked to be able to take out bigger amounts. “So our maximum used to be R2,000 over six months. Now our maximum is R4,000 over a nine-month period, and that part of the product has now been well received. So our loan book growth is what we expected when we introduced the new loan and we expect that loan book to continue to grow,” said Mali.

Lesaka reported group revenue of R2.5bn for the quarter, down 4% year on year. Operating income was down 27% year on year at R10.9m. In the consumer division, revenue rose 32% to R445.8m.

The merchant division — which serves big corporates, taverns, spaza shops other township retailers —  reported net revenue of R782m, up 58% year on year. Its enterprise division provides customers with a bill payment platform, EasyPay, and distributes prepaid electricity meters and tokens.

For the full year ending June, Lesaka expects revenue to between R10bn and R11bn and group adjusted earnings before interest, tax, depreciation and amortisation of between R900m and R1bn. Recently, Lesaka made a number of acquisitions to bolster its business and expand into more countries on the continent. Apart from South Africa, Lesaka now has a presence in Namibia, Botswana, Zambia and Kenya. 

“We are looking at other acquisitions that can give us more scale in terms of geography. We want to be the leading fintech in southern Africa, and not only in South Africa,” Mali said.