Nigerian Fintech Raises US $4.5 Million

April 21, 2021
Connor Cassidy

Over the past decade, Africa has seen an explosion in fintech applications and for the country of Nigeria, the growth rate has been immaculate. The major roadblock for many of these startup’s is the difficulty in accessing real-time banking data. This, in turn, creates a bottleneck when onboarding and verifying customers. One area that has seen exponential growth is the Plaid-esque companies that all offer their own twists and interpretations to their platforms to deal with and solve this issue.

As reported by Tech Crunch, Nigeria’s Okra, arguably the first to gain mainstream attention, is announcing that it has closed a seed round of $3.5 million. Susa Ventures, which is based in the United States, led the funding round. Other well-known investors included TLcom Capital, who was the sole investor from its US $1 million pre-seed round back in 2020. Also, Accenture Ventures as well as some angel investors participated. In total, Okra has raised $4.5 million in two rounds and the company will use the investment to expand its data infrastructure across Nigeria.

Okra describes itself as an Application programming interface, or API, “super-connector” that processes real-time financial information between customers, applications and banks through its secure portal. Fara Ashiru Jituboh and David Peterside founded the company in June 2019. When launched in the first month of January, Okra was incredibly aggressive in pushing to be connected to all banks in the country and has since claimed a 99.9% guaranteed uptime. The business model is built around the integrations of developers and businesses into existing bank’s services, all while taking a commission off the transaction. These integrations include accounts authorization, balance, identity, income, payments and transactions.

Ashiru Jituboh told TechCrunch that besides making APIs, Okra is in the business of selling “digital first-experiences and transformation. We are building an open finance infrastructure that enables developers and businesses to offer digital-first experiences and financial products,” she said. “We’re at a point where businesses are realizing that digital transformation is one of the most conversation happening in most boardrooms. So for us, we’re essentially just making tools and services needed to achieve digital transformation at scale with our APIs.”

This can help explain why Okra has seen such mighty growth over the past year. According to company insiders, it has recorded an average month-on-month API call growth of 281%. They also added that it has analyzed more than 20 million transactions, to put that in context with the most well know platform in this space, Plaid has analyzed more than 10 billion transactions in its eight years of existence. “I think it’s a good indicator that we’re on the right trajectory in terms of traction,” COO Peterside added.

One thing all other fintech startups in Africa can learn from Okra’s rise over the past year is that accelerated growth comes with increased government scrutiny by regulators. Since 2020, Nigeria has seen a plethora of regulatory moves targeted toward payments, crypto and wealth tech startups. While the government has stood firm on its position of protecting Nigerian consumers it has really hampered innovation in the space, something Okra needs to be hyperaware of.

 

Reference:

 

Kene-Okafor, Tage. “Nigerian Fintech Okra Raises $3.5M Backed by Accenture Ventures and Susa Ventures.” Tech Crunch, 21 Apr. 2021, techcrunch.com/2021/04/21/nigerian-fintech-okra-raises-3-5m-backed-by-accenture-ventures-and-susa-ventures.

 

Leave a comment