The Second Cohort of the Visa Africa Fintech Accelarator
Hi Fintech friends 👋,
Here are the highlights of what happened in African Fintech this week;
Two fintech acquisition deals were announced in South Africa.
The most preferred global banking partner for African startups closed accounts of startups in 13 African countries.
A Nigerian digital bank was hit by a $4 million cyberattack and is seeking legal recourse for recovery.
After acquiring a Nigerian wealth tech startup in 2023, a Nigerian fintech was recently in talks to acquire another Kenyan wealth tech startup.
The global VC whose portfolio includes an African fintech unicorn stated they will continue to support emerging market entrepreneurs, even if the currency devalues.
Three African fintechs have expanded into more markets both locally and internationally.
💸Fundraise and Exits
South African ticketing startup Quicketwas acquired by Ticketmaster, the world’s leading ticket marketplace.
Banking and Fintech in South Africa
South African Fintech Peach PaymentsAcquiredOperativa.
💰 Venture Funds
“Whether the naira or real devalues, we’re on the entrepreneur's side.” Endeavor CEO said long-term capital needs to be prioritized in emerging ecosystems.
Endeavor Global’s co-investment fund, is home to over 50 such unicorns (having invested in over 300 companies across 30 countries).
🚀 Partnerships & Product Launches
After recording $1.2 Million in ticket sales in 2023, Tix Africaexpanded to Rwanda and the UK.
Tix by numbers in 2023
RaenestSecured International Money Transfer Operator (IMTO) license from Central Bank of Nigeria to process international transfer.
New Regime for IMTO license in Nigedia
Egyptian fintech startup Banknboxpartnered with Jordanian payments provider CSC Jordan to drive financial inclusion and offer joint advanced services to customers of both companies.
Mastercard Payment Index 2022: Consumers in Egypt embrace digital payments
Pesaunlocked new markets to keep remittances flowing to emerging economies.
Ten companies making it easier for Africans to send and receive money internationally.
LemFiexpanded its International Payment Services to Brazil and Mexico.
👔 Leadership Lineup
Klasha, a leading cross-border payments company appointed Justin Fan as Managing Director, Asia Operations to lead its expansion into Asia.
Justin Fan
📰 News of the Week
US Bank Mercuryclosed accounts of startups in 13 African countries after internal compliance changes.
Image source: Mercury
Mercury, a San Francisco digital bank that became the preferred banking partner for African startups after Silicon Valley Bank went under in March 2023, will close the accounts of users in thirteen African countries by August 22, 2024, leaving them scrambling to find alternatives. The new restrictions will affect users in 37 countries.
Burundi, Cameroon, Central African Rep, DR Congo, Congo, Liberia, Mali, Mozambique, Nigeria, Somalia, South Sudan, Sudan, and Zimbabwe are the thirteen African countries affected by the restrictions.
“Mercury is going zero tolerance on banking companies in sanctioned regions. It is easier to close all Nigerian accounts than to spend extra effort on verifying legitimacy,” an executive at a Nigerian fintech who asked not to be named so he could speak freely, told TechCabal.
“Due to recent changes in how we determine account eligibility, we are no longer able to support accounts for businesses with associated addresses located in these countries,” according to emails seen by TechCabal. With the new prohibitions, African startups incorporated in Delaware cannot open Mercury accounts unless the founders live in the U.S.
👀 Eye Openers
Mercury announced that it will close the bank accounts of most African startups. How should African startups navigate this situation?
somebody will be sending around a Mercury-for-Africa pitch deck in 1 month based off this twitter banter— Nik (@NikMilanovic) March 2, 2022
Should we expect to see an African banking solution for African startups?
We’re live with FDIC insured USD accounts and USD accounts in local African countries as well. Fully API-based and via a dashboard as well. (https://t.co/qhAHlgSuNP)
My DM’s are open as always! https://t.co/hteBAVFjKK— David Nandwa 🍯💛 (@justvibesncode) July 23, 2024
Can an 'African banking solution for African startups' be sustainable?
Following Mercury’s closure of accounts, it would seem like a great idea to build a fintech startup providing US banking services to African startups. It’s a bad idea.
- On a long enough timeline, it will face the same compliance issues.
- Startups rely on VC funding, have…— STONΞ (@StoneAtwine) July 24, 2024
How can we sustainably improve banking for African startups on a global scale, considering that these startups operate in Africa but hold most of their money in dollars outside the continent? Share your comments; I will be publishing them in the next newsletter.
📑 Read of the week
Hate them or love them, the agents are here to stay. (Techcabal)
📖 Other News, Reads, and Media
Wasoko ex-employees discontinued the wrongful termination suit.
Risevest, the Nigerian fintech startup, was in talks to acquire Hisa, a Kenyan Fintech startup. Both startups give users access to US stocks. If the deal goes through, it will be the Nigerian startup’s second acquisition after it acquired digital trading startup Chaka in September 2023.
Hope PSBhit by $4 Million cyberattack, seeks legal recourse for recovery.
🎥 VIDEO INTERVIEWS/DISCUSSIONS
Interview with Sam, CEO of Nigerian Fintech OurPas on Fintech and his perspective on the hidden flaws of traditional networking and tech conferences.
🦉 Tweet of the Week
In 2019, just after our Series A. FRB had just closed our account and handed us a cheque of $5m.
I & Pelumi, walked bank to bank on the street of SF, with a $5m cheque finding a bank, they all said gtfko https://t.co/e2a1fOop8F— Yinka (@waleyinks) July 23, 2024
🎯 Fintech Opportunities
Visaopened Applications for the 3rd Cohort of its Fintech Accelerator Program for Africa.
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Made in Tanzania 🇹🇿 with 💚
