Nigerian Fintech Firm Interswitch Acquires Healthcare Startup

Written by Peter Pedroncelli
Mitchell Elegbe is the CEO of Nigerian fintech firm Interswitch. Image supplied by eClat Healthcare

Nigerian fintech firm Interswitch has acquired a healthcare tech startup and plans to use it to introduce its payment services to the Nigerian healthcare market.

Interswitch is planning to list on both the London and the Nigeria stock exchanges in the first half of 2020. The company has set a valuation between $1.3 billion and $1.5 billion

eClat Healthcare is a Nigerian startup that develops hospital management software solutions, according to an Interswitch press release.

Interswitch did not disclose the value of the deal but said that it now owns a 60 percent stake in eClat following the purchase of shares from current shareholders and subscription to new shares issued by the company.

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Founded in 2002 by CEO Mitchell Elegbe, Interswitch has developed a multi-channel network for payment services across Africa. The Nigerian fintech firm is owned by private equity firm Helios Investment Partners.

U.S. credit card firm Visa has reportedly paid an unconfirmed $200 million for a 20 percent stake in Interswitch, which, if true, could help confirm the Nigerian firm’s unicorn status.

eClat was founded in 2012 by Dr. Wallace Ogufere and Femi Olapegba.

eClat Healthcare’s Dr. Wallace Ogufere (left) and Interswitch’s Mitchell Elegbe (right)

eClat’s main product is software that provides electronic billing, immunization and ante-natal functionality. It’s used in more than 250 public and private healthcare facilities in Nigeria.  

Interswitch says it has acquired eClat to introduce its payment services to the healthcare market in Nigeria, according to a press release.

The Nigerian fintech unicorn expects to integrate its payment functionality into eClat’s existing platform which is already in use across hundreds of Nigerian facilities.

Interswitch owns Verve, Nigeria’s most used payment card, accounting for 18 million of the 25 million credit cards in circulation in the country, according to the FinancialTimes.

Interswitch has a history of acquisitions

Acquisitions have been a major part of Interswitch’s strategy in the last five years. It acquired electronic payments processing firm Paynet for an undisclosed amount in 2014 and software company Vanso for $50 million in 2016, according to Crunchbase.

Interswitch also owns Quickteller, an online payments platform; Retailpay, a mobile business management platform, and Smartgov, an identity management and e-payment infrastructure for regional governments, Revolvy reports.

In preparation for the initial public offering, Interswitch hired JPMorgan Chase & Co., Citigroup Inc., and Standard Bank Group Ltd as advisors, according to Bloomberg.