Friday, June 14, 2024
Startups in Africa

5 Startups Disrupting Africa’s FinTech Scene

Just like in most parts of the world, Fintech is thriving rapidly. Investment is flooding into startups providing innovative and problem-solving means of offering financial services.

Globally, the growth in the Fintech sector is quite massive, an evidence of this is that the sector raked the sum of US$19.1 billion in 2018, which is a 106 percent jump from 2014.

Africa’s FinTech industry is not only growing, but thriving. Almost one-third of funding raised by African startups in 2017 was in the fintech industry.

In 2018, venture funding for African startups increased by 51%, reaching $195 million. There are a wealth of startups transforming how consumers use technology and redefining the customer experience in financial services.

We have put together a list of five promising and prominent African Fintech startups that are currently disrupting Africa’s Fintech scene:

1) Piggybank

Founded in 2016, Piggybank (Now Piggyvest) is a mobile savings platform which targets young people both within and outside Nigeria.

Through its mobile app, users can save as little as $1 a day and then, restrict when they withdraw their savings to specific set dates they choose. On average, Piggybankers can earn 6% per annum on automated savings or 10.95% yearly on its fixed deposit product, Safelock.

In 2018, the Nigerian startup secured seed funding of $1.1 million to grow its online savings platform. But, prior to this time, already announced in late 2017 that the company had grown its savings base by 3000% to N1 billion.

The company is tackling a problem endemic to Nigeria, and across Africa ‒ savings.

According to the company, 80% of Nigerians and most probably all Africans need to save at least, 40% of their monthly income to survive and pay for daily expenses. However, in a society like Nigeria, with no credit system to speak of, the vast majority of payments which are made in cash and savings, inevitably, slip away.

We look forward to seeing the company sustain its performance to help Nigerians and Africa at large build a healthy saving culture.

2) Numida

Uganda’s Numida is also one of the topnotch fintech startups making waves in Africa. From tracking expenditures and debts, to laying out more than just financial data for lenders to see, Numida’s app TrackApp, could open the doorway for small businesses to have access to the funds they need at competitive rates they can afford.

With TrackApp, small business owners and potential owners can track every element of their finances. They can spot, analyze and correct bottlenecks, overspending, and gaps they need to fill. This information helps make profit margins bigger, and leaves room for cost reduction in many areas
Seedstars declared Numida as winner of the Kampala leg of the Seedstars World competition in 2017.

The startup has already secured $140.000 in fundingfrom angel investors. With a 15% week-on-week growth since March 2016, the startup has disbursed 160 small business loans to 105 clients with a 99% repayment rate.

3) Jumo

In 2018, Jumo; A Cape Town-based fintech startup became the first South African startup to be selected by Google for its Launchpad accelerator.

Since its inception in January 2015 to April 2017, the company has grown from just seven to 300 employees. It now has development offices in Cape Town, Nairobi and Portugal. In 2018, the startup landed a whopping $52 million funding deal.

Jumo facilitates digital financial services such as credit and savings in emerging markets. The startup, founded in 2014 by Watkins-Ball is already active in seven African countries — South Africa, Ghana, Kenya, Rwanda, Uganda, Tanzania and Zambia, as well as in Pakistan and Singapore.

Since its inception, about 7.5 million customers have used the platform to either save or source credit. Of this number, about 75% are small business owners.

4) BitPesa

This pan-African fintech startup is redefining how businesses make payments to and from sub-Saharan Africa. Focused on using cutting-edge blockchain technology to increase efficiency across markets, BitPesa opens corridors for business payments and trade between Africa and the rest of the world.

Unsurprisingly, this Kenyan-based startup is one of the most recognizable of the African startups with its blockchain business payments now serving 6,000 customers across 85 countries.

In 2017, the startup raised a $2.5 million Series A round. A year later, it secured a follow-on round led by VC firm Greycroft Partners to the tune of $10 million.

The startup, which allows users to buy and sell digital currencies while also making international payments, also acquired Spain-based online money transfer platform TransferZero early in 2018 in a bid to further accelerate its growth across the world.

5) Paystack

Paystack is one of the leading fintech companies in Nigeria and indeed, Africa. Founded in 2016, Paystack offers payment services to more than 17,000 businesses and is responsible for 15% of all online payments that happen in Nigeria today.

The startup has also continued to raise millions upon millions of dollars from both foreign and local investors. This is, however, aside the millions it earns monthly as direct reward for its services.

In 2018, Paystack was among the three Nigerian fintech companies CB Insights ranked as one of the 250 fastest-growing fintech companies in the world.

Many people are already looking up to Paystack to come up with a mobile app, something that it most likely will unveil, as the year continues to unfold.

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