Wallet Africa, a Nigerian fintech startup founded in 2018 has raised an undisclosed round of investment. Wallets Africa was born out of its founder’s epiphany as a software engineer at SureGifts, a gift voucher company.
While integrating the SureGifts’s core backend with Kenya’s mobile money service, M-Pesa, he noticed one could make use of a SureGifts voucher to pay at an M-Pesa till at a mall or to get tickets at an IMAX cinema in Nairobi.
“The epiphany I had was that very soon all financial transactions would be done through digital wallets. If it could happen on the Internet with PayPal and offline in Kenya, it could happen here in Nigeria,” – John Oke, CEO Wallets Africa.
He also noticed how difficult it was for platforms like Quickteller to handle reversals when his transfers or bill payments failed. According to him, when a transaction went wrong, he’d have to visit his bank after spending hours on the phone with the platform’s customer care representative. Oke gained experience about the financial space by working and consulting for banks and fintech companies like Interswitch.
In January 2018, Wallets Africa released its beta. With the platform, users could pay bills, buy airtime, and make money transfers. It also began issuing prepaid virtual dollar cards to people who wanted to make payments on platforms like Amazon or Netflix. The business took a new turn when it made it to Y Combinator(YC) in March 2019. African startup founders at the accelerator used the platform for employee payroll, customer payouts, Airbnb bookings, and Uber trips. At the accelerator, they discovered that the platform could be useful for startups and small businesses. They soon discovered that the platform could be useful for startups and small businesses.
“We launched our product for businesses and so far we have signed up 1,400 businesses. They particularly use our product for bulk transfers, payroll, and expense cards.” – John Oke.
Before joining Y Combinator, Wallets Africa had 17,000 users and processed about ₦900 million ($2M) monthly. Post-YC, it is currently doing more than ₦3 billion ($6.7M) monthly, a figure it did for the whole of 2018. The two-year-old startup has over 43,000 users.
Participants of this round of investment include Mozilla Corporation, Michael Seibel – Y Combinator CEO, 9Yards Capital, Samurai Incubate, and the Y Combinator who invested $150,000 in the fintech startup in exchange for 7.5% equity at the first round. Maria Alegre, CEO of Chartboost; Microtraction; Venture Souq; and Brad Flora have also invested in the company.
With the funding, Wallets Africa will ramp up its efforts to acquire customers. Last year, it launched its Internet banking solution for businesses and the funding will allow it to gain market share in the space. Wallets Africa will also be helping these businesses and developers issue wallets the way most of them issue cards these days.