Profitable African fintech PalmPay is in talks to raise as much as $100M

PalmPay, an African digital financial institution fintech, is in talks to lift between $50 million and $100 million in a Collection B spherical, in response to a number of sources conversant in the matter.

It’s unclear what valuation it hopes to get, however its final spherical, in 2021, ranked it among the continent’s most valuable startups, estimated simply shy of unicorn standing.

Whereas PalmPay declined to touch upon fundraising specifics, a spokesperson mentioned the six-year-old fintech is “in a powerful monetary place and exploring development alternatives.”

The corporate, which has raised almost $140 million throughout its seed and Series A rounds, is now worthwhile, in response to folks conversant in its funds.

The brand new capital, anticipated to incorporate each fairness and debt, will gas PalmPay’s enlargement: deepening its footprint in Nigeria, scaling its newer business-focused providing, and rolling out each merchandise in new markets throughout Africa and Asia.

Final month, PalmPay introduced it had hit 15 million every day transactions, pushed by its 35 million registered customers. These transactions now add as much as “tens of billions of {dollars}” yearly in worth, in response to the corporate.

Income has additionally surged. PalmPay’s income — $64 million in 2023, in response to the Monetary Instances — has greater than doubled since, folks conversant in the corporate’s financials say. 

Launched in 2019, PalmPay began out in Nigeria, Africa’s most populous nation and a significant fintech hub. On the time, over half of adults within the nation have been unbanked, and conventional banks catered principally to salaried or formal-sector purchasers, usually with necessities that excluded mass-market customers.

PalmPay noticed a possibility to flip that mannequin on its head: construct a digital financial institution from scratch, however optimize it for the realities of Africa’s casual financial system. The corporate launched an app that includes on the spot onboarding, zero switch charges, and a rising suite of providers (together with credit score, financial savings, insurance coverage, and invoice funds) all tailor-made to the wants of underbanked customers and small companies.

Crucially, PalmPay didn’t rely solely on digital acquisition. The fintech constructed an unlimited on-the-ground community of over 1 million small companies and agent retailers, who now serve greater than 10 million prospects month-to-month by means of the PalmPay Enterprise app and point-of-sale gadgets (for cash-in, cash-out providers). 

Different main fintechs within the nation, together with OPay, Moniepoint, and Paga, have additionally adopted the hybrid mannequin, combining digital apps with physical touchpoints.