PawaPay, a UK company focused on building financial infrastructure in sub-Saharan Africa, announced raising a $9 million seed round co-led by 88mph and MSA Capital, according to EU-Startups.
The company, which spun off last year from online sports betting company betPawa, says it wants to become the market leader in high-volume mobile money payments and offer API access to telecom operators’ mobile money systems.
Zagadat Capital, Kepple Ventures and Vunani Capital also participated in the seed round. PawaPay’s CEO Nikolai Barnwell formerly headed betPawa’s New Markets in Africa and sits on the board of 88mph.
“We’re making a very heavy bet on the rise of mobile money and all the complexities that arise out of mobile money and all the infrastructure that needs to be built around payments with mobile money at its core,” Barnwell told TechCrunch.
While mobile money is common in East Africa, most of the technology is led by telecommunication operators, creating a need for unified infrastructure. PawaPay has technical integrations with AirtelTigo, Econet, MTN, Safaricom, Orange and Vodafone and uses its APIs to offer merchants condensed and simplified access to services.
PawaPay says that 66% of global mobile money transactions are made in sub-Saharan Africa, with up to $500 billion moving through the market yearly.
The company hopes to use its technology to reach the 350 million unbanked customers in sub-Saharan Africa and connect them to the services they have been underserved with, according to TechCrunch.
The service is aimed at unbanked individuals, the majority of which earn minimum wage and do not have attractive KYC (Know Your Customer) metrics for traditional banks.
Since launch, PawaPay has processed over 257 million transactions worth over $1.25 billion with a 99.9% completion rate and 0% chargeback rate, according to the company’s website.
“And the way we’re looking at the continent, we’re looking at adoption rates for mobile money growing at an insane speed. It has become quite obvious that this is a very significant financial infrastructure and there’s a lot of it that’s been missing if you want to work serious volume and businesses on mobile money,” Barnwell added.
PawaPay currently handles over 10 million transactions per week on its railed across 10 African countries including Cameroon, DRC, Ghana, Kenya, Mozambique, Nigeria, Rwanda, Tanzania, Uganda and Zambia.
The company has a number of competitors in Africa, including MFS Africa, Flutterwave, DPO Group, Paystack and Yoco.
In other recent fintech news, Nubank is seeking a $55 billion valuation for its upcoming IPO. Cross-border Australian fintech Airwallex is also attempting to plant roots in the US.