| Uganda | SafeBoda secures payment licences to provide financial services. SafeBoda, a mobility startup that provides ride-hailing and delivery services in Uganda, has secured two licenses to offer payment services, including mobile money services in Uganda. This is coming only a month after SafeBoda received an undisclosed amount from Google to become the first recipient of the Google Africa Investment Fund. Techpoint Magazine |
| | EDITOR'S NOTE | There’s an increasing trend of businesses in non-financial sectors evolving to provide financial services to their users. These companies offer a service, acquire some users and gain important distribution. Over time, businesses offer relatively asset-light, high-margin financial services to increase the average revenue from existing users and acquire new users. The eventual goal of companies that do this is to become a super-app for both financial and non-financial services.
It will be interesting see how Safeboda executes this strategy first in Kenya and inevitably across the continent. |
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| Nigeria | One Payment secures payment service licence to operate in Nigeria One Payment, a subsidiary of DPO group, has secured a PSSP licence in Nigeria. This licence will allow the Kenyan company which has been in operations since 2006 and has operations in 20 African countries, to provide payment services for Nigerian businesses. Afrikan Heroes |
| | EDITOR'S NOTE | In October 2021, DPO group was fully acquired for $288m by Network International (NI), the MENA payments company. The acquisition was part of NI’s Africa expansion strategy. When you consider the strength of Nigeria’s population and its influence in the African digital payments market, it makes sense for DPO group to pursue a licence like this to allow it to expand into Nigeria and compete with incumbents like Paystack and Flutterwave.
DPO is uniquely positioned to reap the benefits of this expansion as it currently has operations in more than 20 African countries which makes it easier for them to open up their existing merchants to the Nigerian market.
It will be interesting to see how DPO interconnects all its markets to enable smooth payment operations and intra-Africa trade and also offer a one-market, one-checkout solution to businesses looking to integrate payments in Nigeria. |
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| | EDITOR'S NOTE | Traditional rails in many African markets have been already been built to offer cheap real-time payments with even more abstraction being built to cover most financial use-cases. However, crypto rails are also proving a promising alternative, especially for users interested in cross-border remittances and the movement of digital assets. It is very likely that the rails of the future will be a combination of both i.e. leveraging existing banking systems to offer users financial services, but engaging crypto rails to offer users additional value. |
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| Global | The promise of stablecoins. In this article, Ngozi Dozie explores the potential for the adoption of stablecoins in real-world scenarios. Substack |
| | EDITOR'S NOTE | Stablecoins are digital currencies that peg their value to a reserve asset, usually another fiat currency or a basket of other cryptocurrencies. The purpose of this is to ensure price stability and reduce volatility typically associated with cryptocurrency. |
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| Africa | What is the future of agency banking? In this thread, Wizaj and Chris Muscarella sparked a discussion on the long-term place of agency networks for payments. Twitter |
| | EDITOR'S NOTE | Agency banking networks have been at the forefront of the race for financial inclusion in emerging markets. Due to high density and lower barrier to entry, agency banking has garnered popularity and become relevant for fintechs who intend to make their services accessible to the banked and unbanked.
As mobile and internet penetration continues to grow, one would expect that agency banking would see reduced usage as financial institutions would be able to provide relatively cheaper and better services to their customers. However, due to established trust and learned financial behaviour with these agency networks, this is a transition that might not happen quickly or easily. |
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| Global | Predicting the future of fintech in 2022 In this episode, Benjamin Ensor, Gwen Kiwana, and Alex Hooper share their predictions for fintech in 2022. They also shed light on why traditional banks need to move from building apps and websites alone to digitizing their core systems to the cloud and building new systems. Fintech Insider Podcast |
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| Egypt | Fawry plans $51m growth capital raise via Rights issue The Egypt-based fintech company plans to raise this capital to fund its expansion and investment strategy. Fawry is also exploring US listing as another avenue to raise money from investors and the public. Disrupt Africa |
| | EDITOR'S NOTE | Fawry can explore this kind of fundraising because it’s a publicly-traded company that was listed on the Egyptian Stock Exchange in 2019. Right issues allow existing shareholders in a company to purchase the company shares at a future date for a price lower than what is being traded on the market. |
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| Tanzania | NALA raises $10m seed round Tanzanian fintech startup, NALA, has closed a $10m seed round to build out its international transfers solution. This round was led by Amplo, Accel and Bessemer Partners, and it included local investors like DFS Lab and Angel investors like the Co-founder & CEO of Robinhood, Vladimir Tenev, the head of Google Payments, Peeyush Ranjan, and early employees at Revolut and TransferWise. TechCrunch |
| | EDITOR'S NOTE | Before this raise, NALA had only raised $980k in its pre-seed round and this was 3 years ago. At that time, NALA focused on building Mobile solutions for East African countries but they pivoted last year when their users began to demand international money transfers.
They will now be competing with Chipper Cash, Lemonade Finance, Zazuu, and Sendwave in the international transfers and remittance space. |
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| Uganda | Chari raises bridge round at $100m valuation YC-backed Moroccan B2B e-commerce and retail service provider, Chari, has raised an undisclosed bridge round to allow them to offer BNPL services to their customers. This round was led by existing investors; Y Combinator, Rocket Internet, Global Founders Capital, Plug n Play, Orange Ventures, Harvard University Management Company, Village Capital, and P1 Ventures. They also welcomed new investors like Khwarizmi Ventures, Air Angels, and Afri Mobility — the venture capital arm of AKWA Group. TechCrunch |
| | EDITOR'S NOTE | Last year October, Chari acquired a ledger and bookkeeping company called Karny. The strategy was to use Karny’s expertise to assess the books of its customers so that they can properly understand the credit ratings of the businesses that they serve. |
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| Did You Know? | Capital Records: VC funding in Africa grew over 2.5X in 2021 African tech startups raised an estimated $4.8bn of VC funding in over 750 deals in 2021. This is over 2.5x the total received in 2020. Five countries accounted for over 70% of the total funding across the continent: Nigeria ($1.5b), South Africa ($838m), Egypt ($588m), Kenya ($375m), and Senegal ($222m). Nigeria also recorded the highest amount of deals at 215, followed by Egypt, Kenya and S. Africa with 119, 119, and 118 deals respectively. The continent also achieved a milestone in 2021 by recording for the first time, deals worth $100m and above. There were 12 of such deals in the year, the highest of which was a $400m funding for OPay in Nigeria led by SoftBank. It will be interesting to see if funding will maintain this growth rate through 2022, what do you think?
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