In a funding round led by China-based MSA Capital, along with participation from Zagadat Capital, Kepple Ventures, and Vunani Capital, pawaPay, a UK-based and Africa-focused mobile money company has raised over $9 million in seed funding. With the proliferation of digital infrastructure on the continent and a greater reliance on online payments infrastructure, Africa is becoming more focused on mobile payments options. pawaPay utilizes integrations from telecom operators such as AirtelTigo, Econet, MTN, Safaricom, Orange, and Vodafone to generate its single API for businesses. The company manages local operations, compliance, regulatory cover and bank accounts for its users.
The company is offering value to its customers and merchants by enabling them access through its API to mobile money transactions to millions of mobile money accounts. As Nikolai Barnwell, CEO of the company, is quoted as telling TechCrunch,
In Kenya alone, this year, mobile money use hit over 970 billion shillings (~$8.8 billion). The bulk of these transactions have been facilitated by the Mpesa network, which accounts for about 98.8% of the total market share, while Airtel Money and T-Kash share the remnants respectively. In West Africa, the story has not been far from different, with over 198 million mobile money accounts, as at 2020, relative to East Africa’s 293 million. West Africa’s growth in terms of transaction value had risen to about 46%, with Ghana, Senegal and Ivory Coast leading this growth.
Part of this spike in online transactions and the use of mobile money comes from adaptations to the new normal of post-COVID realities. With increased digital penetration within many African countries, there is the greater reliance on online payments systems and infrastructure, and the use of mobile money to enable transactions seamlessly between individuals and businesses. Reports by Visa show that e-commerce received a 5% boost in 2020, in the face of closure of face-to-face retail. These show the expanding vistas of opportunities in mobile money and etransacting that Africa is recording.
pawaPay claim that their system oversees over 10 million transactions per week, with beta operations already set up in over 10 African countries, namely, Cameroon, DRC, Ghana, Kenya, Mozambique, Nigeria, Rwanda, Tanzania, Uganda, and Zambia. With this wide geographical reach the company is looking at more creative ways of offering value to the African ecosystem, and penetrating more underserved areas of Africa. They however, point to the challenge of regulation that stalls their growth and expansion to these areas, while maintaining their commitment to keeping within the ambit of the law in their operations. With this fund, they will be looking at expanding more and penetrating deeper within Africa’s geographical markets.