Retail giant Pepkor has deepened its push into financial technology by acquiring a controlling stake in a combined fintech platform with Shop2Shop.
The deal will be completed through a R1.57-billion cash investment into Shop2Shop and the transfer of 100% of Pepkor’s Flash business, which has been valued at R10.6-billion. Together, the two components give the transaction a total value of roughly R12.17-billion.
The combined business, to be known as FintechCo, is expected to process more than R200-billion in annual transaction value and create one of South Africa’s largest merchant commerce and financial technology platforms serving both the formal retail sector and the country’s vast informal economy.
The retailer announced on Wednesday that it will acquire a 57.1% controlling stake in the combined fintech business, which has been valued at about R21.3-billion.
The R1.57-billion cash injection will be used primarily to settle Shop2Shop’s debt and other financial obligations, while the contribution of Flash significantly increases Pepkor’s ownership in the combined business.
Strengthen presence in informal market
Pepkor said the acquisition forms part of its strategy to strengthen its presence in the informal market, where small businesses increasingly rely on digital payment systems, cash management services and value-added financial products.
Flash is one of South Africa’s largest value-added services platforms, distributing products such as prepaid airtime, electricity, gaming vouchers and digital financial services through an extensive merchant network.
Shop2Shop, meanwhile, provides informal traders with card payment facilities, acquiring services, cash management solutions and other merchant services designed to help small businesses operate more efficiently.
They revealed that for the 12-month period ending September 2025, Flash recorded R488-million while Shop2Shop recorded R985-million in profits.
Shop2Shop founder Peter Berry said the partnership would accelerate the company’s growth in the underserved informal retail market.
“Shop2Shop was founded to bring purpose-built solutions to South Africa’s large and underserved informal merchant market, to empower small business owners.
“We’ve built a broad product set on a platform engineered for high-volume, low-cost transactions. With Flash, we are able to deepen our offering and scale and position a proven fintech platform in South Africa,” said Berry.
Broader fintech ecosystem
Pepkor said combining the two businesses would create a broader fintech ecosystem that links digital payments, cash handling, merchant services and financial products onto a single platform.
The company said the transaction also creates a pathway towards unlocking shareholder value through a planned separate stock market listing of FintechCo in the medium term.
As part of the agreement, the existing Shop2Shop shareholders will remain strategic minority investors and retain at least a 15% stake in FintechCo for a minimum of five years after the deal becomes effective.
The acquisition remains subject to regulatory and competition authority approvals before it can be completed.
- Pepkor acquired a 57.1% controlling stake in a combined fintech platform with Shop2Shop, valued at approximately R21.3 billion, through a R1.57 billion cash investment and transfer of its Flash business (valued at R10.6 billion).
- The new entity, FintechCo, is set to process over R200 billion in annual transactions and serve both formal retail and South Africa's extensive informal economy.
- The acquisition aims to strengthen Pepkor’s presence in the informal market by expanding digital payment, cash management, and value-added financial services to small businesses.
- Flash and Shop2Shop recorded combined profits of over R1.4 billion for the year ending September 2025, with Shop2Shop focusing on card payment and merchant services for informal traders.
- The deal plans to create a comprehensive fintech ecosystem with potential for a separate stock market listing of FintechCo, while Shop2Shop shareholders will retain a minimum 15% stake for at least five years. Regulatory approvals are pending.
Retail giant Pepkor has deepened its push into financial technology by acquiring a controlling stake in a combined fintech platform with Shop2Shop.
Pepkor said the acquisition forms part of its strategy to strengthen its presence in the informal market, where small businesses increasingly rely on digital payment systems, cash management services and value-added financial products.
Shop2Shop, meanwhile, provides informal traders with card payment facilities, acquiring services, cash management solutions and other merchant services designed to help small businesses operate more efficiently.
Shop2Shop founder Peter Berry said the partnership would accelerate the company's growth in the underserved informal retail market.
“Shop2Shop was founded to bring purpose-built solutions to
“We've built a broad product set on a platform engineered for high-volume, low-cost transactions.
Pepkor said combining the two businesses would create a broader fintech ecosystem that links digital payments, cash handling, merchant services and financial products onto a single platform.
As part of the agreement, the existing Shop2Shop shareholders will remain strategic minority investors and retain at least a 15% stake in FintechCo for a minimum of five years after the deal becomes effective.
