The potential to bring electronic payments to the continent of Africa, home to 1.2 billion unbanked and underbanked individuals, has been enough to lure FinTech investment from investors across the globe, to the tune of hundreds of millions of dollars this year alone.
To that end, OPay, the mobile money service, said earlier this month that it raised $120 million in a Series B funding round that in turn was backed by Chinese investors.
The Series B investors featured a roster including Meituan Dianping, Gaorong Capital, SoftBank Asia, IDG Capital, GSR Ventures and Source Code Capital.
The $120 million round comes in the wake of a June capital raising of $50 million.
As reported by TechCrunch, the firm, which is based in Lagos and was founded by consumer internet firm Opera, the funding will be used to expand in Nigeria and in Kenya, South Africa and Ghana. Those expansion plans had been confirmed to the publication by Frode Jacobsen, Opera’s chief financial officer.
In Nigeria, and building on the mobile money services, the company also has on offer ORide, a motorcycle ride hail app, and the OFood delivery service. The firm has more than 140,000 active agents and $10 million in daily transaction volumes, as measured across its payment offering.
In reference to its most recent capital raise, CFO Jacobsen said OPay will use the capital to capture consumers’ high-frequency usage of services spanning daily activities such as transportation and food services.
The OPay financing represents the latest investment activity where Chinese firms have been investing in Africa-based, tech-nimble upstarts.
In another notable headline, and also in Nigeria, PalmPay, focused on mobile payments, has launched in the country in the wake of a $40 million seed round.
The funding round was in turn led by Chinese mobile phone maker Transsion, which made the investment through its Tecno unit. The round also saw participation from China’s NetEase and Mediatek. In a partnership between PalmPay, Tecno, Infinix and Itel, PalmPay’s app will be pre-installed on 20 million phones next year. In terms of expansion plans, the $40 million will be used to grow the PalPay financial services business in Ghana, with movement into additional countries in 2020, per the CEO Greg Reeve, as reported by TechCrunch.
The movement into Africa’s FinTech arena is not confined solely to Chinese firms, of course.
The $200 million investment by Visa in Interswitch for a 20 percent equity stake also creates the first FinTech unicorn across the African continent. In addition to Visa, investors include Helios Investment Partners, TA Associates and IFC. The latest news represents an expansion of the partnership between Visa and Interswitch that took root two years ago.
As reported in this space last week, the valuation against the backdrop of the latest funding round comes in at $1 billion. Among the company’s operations are the domestic debit card Verve and the consumer payments platform Quickteller.
“Sub-Saharan Africa is the fastest-growing payments market in the world, with growth driven by a young and dynamic population, rapidly evolving consumer behavior and an increasing desire for payment solutions that can be accepted across the continent and abroad,” said Interswitch Founder and CEO Mitchell Elegbe, as reported in SkyTech.
Twiga Foods, based in Kenya, has raised $30 million from a series of investors helmed by Goldman Sachs. The company operates as a B2B food distribution company, and as reported by African Business Central, the funding round consisted of $23.75 million in equity, with the remainder in debt financing, and the company will look to boost its supply chain services for agricultural and fast moving consumer goods (aka FMCG) products.