The Fintech sector in Africa has been growing steadily for a few years now and this is one of the reasons why FTX Keneoka for Tech Crunch recently made its first investment in Africa. This is an exciting development for all involved as the booming sector is likely to continue to expand in the coming years.
FTX’s first investment in Africa
FTX, a crypto derivatives exchange, has made its first investment in the African market. The firm plans to leverage the infrastructure of Chipper Cash, an African cross-border payments company, to facilitate money transfer.
FTX’s initial investment is a move towards accelerating the adoption of crypto in the African continent. Crypto adoption is gaining traction in Africa, as people seek to use digital currencies to avoid the high fees involved in traditional remittances. Several exchanges, including AZA Finance, are now offering crypto services in Africa.
AZA Finance is a Kenyan fintech outfit that provides financial services across ten African markets. It plans to expand the usage of digital currencies by promoting the use of the Web 3. FTX’s partnership with AZA is expected to help expand its presence on the continent buxic.
FTX has also invested in a slew of African companies. These include Bitnob, a Nigerian crypto exchange, and Nestcoin, a Nigerian fintech firm. While these investments may not have caused ripple effects in the African crypto community, their ties to FTX may prove to be more significant.
SVB Capital’s investment in Chipper Cash
If you are into the world of fintech, chances are you have heard of Chipper Cash. This is a multi-nation cross-border payments startup that has grown exponentially since its founding in 2017. They are also a few months into a series C round of investment that saw them take in a total of $100 million.
The company was founded by Ham Serunjogi and Maijid Moujaled. The company has a modest portfolio of products and services, including a proprietary peer-to-peer (P2P) cross-border payment solution that can be used across seven African countries. In addition, it has recently expanded to the UK. To help it along, it has secured a $100 million investment from SVB Capital. And that is just the beginning.
The company is looking to take its p2p payments solution to other parts of the world. It currently boasts a 200-person staff, and is expected to add more over the coming months. Similarly, the company has a number of products in the works, including a mobile payment service that will allow users to send money from Africa to the US.
Djamo’s eye on Francophone Africa expansion
Djamo is a new player in the personal finance arena, with a particular focus on French speaking Africa. Co-founded by Regis Bamba and Hassan Bourgi, the company provides a suite of banking services to underbanked individuals. The service has grown from around 90,000 customers in February to over 500,000 today.
The company’s flagship product is a Visa powered debit card which enables online purchases. It also features a peer to peer virtual account, an auto saving tool and a salary-receiving software suite starsworldnews.com.
According o the founders, they have processed $400 million in transactions since the company’s inception. They have plans to expand into two more countries in Francophone Africa before the end of the year.
Djamo’s biggest claim to fame is its ability to offer a seamless banking experience to consumers, especially in the French speaking parts of the African continent. As such, it has joined forces with local banks to provide a variety of payment options.
Fintech in Africa is a goldmine
The African financial services market could reach $230 billion in revenues by 2025. Fintech is expected to be a significant contributor to this growth. In addition, the continent is home to a large diaspora, who want to send money across national borders newstodaysworld24.com.
The fintech space in Africa is becoming a hotbed of investment. The region has seen several major investments in the last two years. These include TymeBank, Interswitch, Chipper Cash, and Jumo. Several startups have raised hundred million dollars in rounds.
The most recent round involved the acquisition of Paystack by Stripe for $200 million. This company’s technology helped create the bridge between traditional banking and digital payments, simplifying credit processes and keeping costs low newstodaysworld.com.
A report released by PwC on the state of the global fintech sector showed a rapid transformation in the industry. Fintech startups are enabling crypto trading and investment, virtual cards, and cashless transactions. Moreover, the PwC survey surveyed 500 executives worldwide to determine factors that drive the financial technology business models of fintech companies techlognews.com.