Record funding for African payment startups in 2021 could mark a turning point
The news: The funding spotlight turned to Africa in 2021 as tech startups broke funding records, raise $ 5 billion across the continent, by TechCrunch.
- FinTechs dominated this financing, accounting for nearly $ 3 billion investments from the continent, by Briter Bridges, i.e. double the amount raised by fintechs in 2020 and triple the total in 2019.
- Payments startups around the world also raised record funding in 2021, totaling $ 31.9 billion as of December 14, according to CB Insights.
Beneficiaries : Here are some of the companies that have benefited from the increased focus on Africa.
- Mobile payment platform Opay amassed one of the largest sums, closing a $ 400 Million Series C Round in August which valued the company at $ 2 billion. SoftBank Vision Fund, the world’s largest technology-focused investment fund, made its first investment in Africa with this funding round. Opay has experienced tremendous growth: Monthly transactions exceeded $ 3 billion in August, up from $ 2 billion in December 2020, per Bloomberg.
- Digital payment provider Floating wave raised $ 170 million in a Serie C round in March. The company expanded globally in 2021, forging partnerships beyond local ties with payment giants like To discover and Pay Pal.
- Digital payment network MFS Africa raised $ 100 million. The powers of the company over 320 million mobile money wallets through a network of around 180 banks and mobile money systems and 250 global institutions.
- Cross-border payments company Chipper Cash raised $ 250 billion between May and November 2021, bringing its valuation to $ 2 billion. Chipper Cash offers a cross-border peer-to-peer payment service through its app, which is used in seven African countries.
The overview: The recent influx of cash reflects the increasing volume of transactions in Africa as more companies recognize its growth potential.
We believe Africa is poised for the next big wave of innovation, with a who’s who of multinational payments giants piling up to make it happen. We have already seen power plants like Bandaged, Zipper, and MasterCard get involved in the region, and we to predict that in 2022, multinational financial services companies will shift from partnerships to acquisitions across the continent.
With 1.4 billion inhabitants and one Collective GDP of $ 2.7 trillionAfrica is a large market ripe for the digitization of payments. Regional giants M-Pesa and MTN MoMo have already built nearly 500 billion dollars mobile money market, showing that breakthroughs in the region are possible and giving payment providers an opening to digitize.