Stitch Acquires Efficacy Payments to Become a Direct Card Processor

South African fintech Stitch Group has further solidified its position as a key payment infrastructure provider by acquiring Efficacy Payments, a Cape Town–based card-acquiring and cash-deposit solutions specialist. The deal was announced in mid-July, marking Stitch’s second strategic acquisition—following the purchase of ExiPay in January—but financial terms were not disclosed.

Founded in 2016, Efficacy became a Designated Clearing System Participant (DCSP) in 2021, making it one of only a few non-bank entities authorized to directly transparent card transactions. By bringing Efficacy into the fold, Stitch gains ultimate control over the entire payment stack—from gateway and switching to settlement—enabling direct online and in-store card processing for merchants

This move represents a strategic leap: Stitch will now operate as a direct participant in the national clearing system, drastically reducing reliance on third-party intermediaries. As Stitch President and Co-founder Junaid Dadan highlighted, the acquisition will enhance conversion rates, streamline reconciliation processes, and accelerate the speed of product rollout for merchants across South Africa. Embedded within the acquisition is also a suite of technology benefits—real-time reporting, reconciliation features, and faster access to new payment solutions

This latest acquisition reflects Stitch’s ongoing strategy to build a fully unified payments ecosystem. Earlier this year, the ExiPay acquisition enabled Stitch to integrate in-person payments into its primarily online offerings, supporting merchants with omnichannel capabilities. Stitch further solidified its market position in April with a $55 million Series B funding round, led by QED Investors, bringing the total funding to over $107 million.

With control over the full transaction pipeline—from user interface to settlement—Stitch is now among the few African fintechs that rival traditional banks in payment infrastructure. This vertical integration positions it to offer competitive pricing, improved user experiences, and faster innovation cycles for its merchant clients, which include names like Takealot, MTN, Vodacom, and Standard Bank’s Shyft

As the South African card payments market is projected to reach R2.9 trillion (approximately $159 billion) by 2025, Stitch aims to capture a significant share by delivering seamless, cost-efficient card acquiring services for merchants of all sizes.

Why it matters for fintech in Africa: Stitch’s expanded capabilities exemplify a shift from front-end consumer solutions to deep infrastructure play, where ownership of clearing, settlement, and reconciliation becomes a powerful competitive moat. As venture capital becomes tighter and regulators scrutinize payment practices, this acquisition highlights the growing emphasis on efficiency, compliance, and integration within Africa’s financial services ecosystem.