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SoftBank’s US$400 Million Africa Bet: Your Weekly Africa Fintech News Digest

by Fintechnews Africa 30 August 2021

In the biggest headline of Africa fintech news last week, Nigerian mobile payments platform OPay raised a staggering US$400 million towards expansion. A number of illustrious global investors were involved in a round that gave Africa its fifth unicorn.

The week boded well for Islamic banking as well, with two companies moving ahead with their plans for the continent. The week also marked a high point for acceleration initiatives, both by local companies and international players.

In other news, governments of several African states take steps to bolster their collaboration with fintechs across the continent.

OPay’s super-sized fundraise

OPay’s US$400 million fundraise was led by SoftBank’s Vision Fund 2, but also included investment from big names such as Sequoia and Meituan (Fintech News). In all, participating investors in the round involved Sequoia Capital China, Meituan’s VC arm DragonBall Capital, Source Code Capital, Redpoint China, SoftBank Ventures Asia and 3W Capital.

The funding round marked a new feat for SoftBank, with OPay becoming the investment giant’s first African investment. It also unlocked unicorn status for OPay. The company is now one of Africa’s five tech unicorns, along with Flutterwave, Jumia, Interswitch and Fawry.

Islamic banking highlights

Ethiopian challenger bank Hijra Bank signed a deal with Path Solutions to integrate with the latter’s core banking platform iMAL (Fintech News). A small but significant news announcement, this marks a step forward for Hijra Bank, which is one of only two Islamic banks in Ethiopia.

In a separate piece of news, halal-based fintech company Wahed announced the receipt of a regulatory license from South Africa’s Financial Sector Conduct Authority (Tech In Africa). The licence will allow the company to bring its digital Islamic banking solutions to the South African market.

Accelerators and corporate challenges

Jordan’s Arab Bank launched its corporate fintech program AB Accelerator in Egypt to promote fintech banking solutions in the country (Fintech News). Meanwhile, GreenHouse Lab announced that it would be welcoming eight African fintech companies into its 2021 GHL Fintech Accelerator program.

African startups also made it into Mastercard’s six-month long global springboard (Disrupt Africa). Two African fintech companies, Karri and Kwara, will be joining a cohort of 11 companies at the Mastercard Start Path programme.

Elsewhere, pan-African banking group Ecobank launched the fourth edition of the Ecobank Fintech Challenge (Tech In Africa). The challenge will allow startups to partner with Ecobank in scaling their solutions.

Public-private partnerships galore

The Ethiopian government confirmed a partnership with Input Output (IOHK) over a national ID blockchain system for students in Ethiopia (Pymnts). IOHK is the company behind the Cardano cryptocurrency. Ethiopia’s Minister of Education Dr. Getahun Mekuria referred to the project as “the single biggest entity deployment of blockchain ever.” The project will go live in Q3 2021.

Meanwhile, e-payment fintech company Pesapal was accredited by the Central Bank of Kenya last week as a payment solutions provider (Tech In Africa). It also received a service license.

Elsewhere, Rwanda’s Kigali International Financial Centre (KIFC) signed an MoU with the Monetary Authority of Singapore (MAS) (KIFC announcement). The MoU formalises the Financial Trust Corridor initiative, KIFC said. The Financial Trust Corridor is an initiative by the Bank of Ghana and the MAS to create an ecosystem for business, including SMEs, and financial institutions.

That’s it for this week’s Africa fintech news roundup.

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