Kudi, a Nigerian digital payments startup, announced that it has secured a Series A funding that will enable the company to fast-track its expansion across Nigeria.
The company which raised $5 million from several existing investors, said the funds will be used to increase its network of bank agents stationed across Nigeria. Kudi also said the funds will also enable the company launch financial services in partnership with banks and fintechs.
The financial services to be launched by Kudi include savings, loans, insurance to both small and informal businesses and individuals.
Majority of the transactions in Nigeria still rely largely on cash. Moreover, Kudi believes that digital solution alone cannot drive financial inclusion. Instead, the company’s agents are needed to achieve the objective.
A statement released by Kudi said “ninety percent of all transactions in Africa still rely on cash. More specifically in Nigeria, 80 percent of the population works informally and is paid cash in hand. With figures still as high as this, digital solutions alone are not enough: Kudi’s agent network bridges the gap”.
Kudi also noted that “Kudi’s mission is to make financial services accessible and affordable to all Africans. Kudi does this by enabling underbanked and unbanked Africans access to basic financial services like money transfer, bill payments and cash withdrawals through an agent’s network. Since its launch in January 2017, Kudi has grown its agent network to over 4,500 merchants and is adding new agents everyday. The company makes it easy for agents to sign-up and have more visibility into their day-to-day operations. They process over $30 million each month”.
The Series A fundraising was led by Partech and joined by Michael Seibel (YC CEO). Khosla Ventures and YC also participated. The General Partner at Partech and Co-lead of the Partech Africa Fund, Tidjane Dème, will also join Kudi’s Board.
The Co-founder and Chief Executive Officer (CEO) of Kudi, Yinka Adewale, said the company will now focus on building on its impressive performance by increasing its workforce with 15 new members.
Y Combinator‘s Michael Seibel said the growth of digital payments in Nigeria will be accelerated by Kudi which is serving as a middleman between cash and the digital payment system.