Hi Fintech friends 👋,

Here are the highlights of what happened in African Fintech this week;

• The Fintech fund launched its second fund to back Fintech startups globally.
• Y-Combinator added an African Travel-Fintech startup into its portfolio.
• Africa based PE firm closed its $470 Million fund to invest in Fintech and other sectors.
• Nairobi based early stage investment firm acquired South African strategy and branding agency.
• Mastercard partnered with Nigeria’s YC Backed startup for direct bank payments.
• A Payments API startup shut down and returned the remaining capital to investors.
• Nigeria charged a detained executive of the world's largest crypto exchange with money laundering.
• A Nigeria-based savings fintech company revealed plans to IPO.
• Ethiopia based commercial bank shamed customers over bank glitch money.

💸Fundraise and Exits

• Triply, a Kenyan Travel-Fintech startup raised $500K from Y-Combinator to assist travel businesses in collecting payments, automating their operations, and then uses this data to provide them with financial services.

• Ghanaian remittance and mobile money fintech Zeepay raised $3 million investment to drive growth.The ten-year-old company, which has raised more than $23 million since it launched, will use the new capital injection to strengthen its financial position in anticipation of its high growth in 2024.

💰 Venture Funds

• The Fintech Fund, whose portfolio includes African Fintechs like Maplerad, Opareta, and Stitch, launched its second fund to support fintech companies focused on payment solutions, transaction orchestrations, data aggregation, financial services APIs, and financial software products.

📢 Announcing Fintech Fund II (TWIF 4/5)

Hello Fintech Friends, I couldn’t be more excited to announce our second fund, The Fintech Fund II! (By our third fund, I promise I will think of a more clever name.) We raised our first fund two years ago after passing 10,000 subscribers. Over the last two years, we’ve

This Week in FintechNik Milanović

• Baobab Network, the Nairobi-based early-stage investment firm that has pledged to invest in over 1,000 African startups by 2033 acquired South African strategy and branding agency Reflector Marketing. Baobab Network portfolio includes African Fintechs like Mudu Pay, Triply and Swahilies.

• Adenia Partners Ltd, a private equity firm focused on African opportunities announced closing its fifth and largest Africa-focused fund to date, Adenia Africa Fund, for $470 million to invest in several industries across the continent, including fintech, telecom, and healthcare.

• Sim Shagaya, founder and CEO of uLesson, launched "The Honey Badger Fund" (HBF), a fund for African entrepreneurs in building technology-powered projects.

🚀 Partnerships & Product Launches

• The Federal Government of Nigeria, through the National Identity Management Commission (NIMC) announced plans to launch a payment-integrated ID for social and financial services.
• Regulator approved LemFi for remittance services in Kenya.

👔 Leadership Lineup

• Detained Binance executive charged with money laundering after the exchange tax evasion case delay.

Tigran Gambaryan, one of the detained executives, was formally charged with laundering over $35 million during his court appearance but did not enter a plea. His arraignment for the money laundering charge is scheduled for April 8, with the tax evasion charges to follow on April 19.

It’s noted that Binance itself has not been charged by Nigeria’s Economic and Financial Crimes Commission (EFCC) or the FIRS, suggesting that Gambaryan may be facing the charges on behalf of the exchange.

📰 News of the Week

• Mono partnered with Mastercard to enable direct bank payments and aims to achieve profitability by the end of the year.

Mastercard, the world's second-largest payment network, has partnered with Mono, a Nigerian YC-backed open banking startup, to facilitate direct payments into bank accounts without the need for cards or USSD codes.

Mono initially partnered with Flutterwave to offer merchants DirectPay Pay with Bank, enabling account-to-account payments. This service has facilitated over ~ $3.8 Million in transactions since 2022. Now, with a new partnership with Mastercard, Mono aims to expand its reach across multiple African countries, leveraging Mastercard's extensive merchant network for increased transaction volume and growth.

“In 2023, we moved from negative to positive gross profit, and we want to be profitable by the end of the year,” Abdul Hassan, founder & CEO of Mono, told TechCabal

👀 Eye Openers

• Can Mobile Money Companies share their agent’s networks with other players?

Anyone who is willing to launch a mobile money service in East Africa, no matter how ambitious they are, always encounters challenges when they consider agents. The mobile money business is similar to hardware tech business, where the agent component is indispensable. Mobile money agents are 26 times more accessible than ATMs and 58 times than Bank branches.

While a few companies like Wave Mobile Money took a different approach in Senegal by building their own agent networks and the entire mobile money infrastructure, which requires significant capital investment(Wave has so far raised ~ $300 Million), I don't see that happening for everyone.

Can mobile money companies share their agent’s network with other players? One of the key competitive advantages of mobile money companies is their agent’s network. This means it is not easy to convince mobile money companies to share their competitive advantage with other players or competitors. However, gone are the days where you can compete solely on the number of agents; instead, there is hope that Mobile Money companies can share agent’s networks and compete on value while delivering significant impact for the ecosystem, similar to how banks share ATMs.

In 2023, Tigo Pesa, the second largest Mobile Money company in Tanzania partnered with DCB Bank to enable customers of DCB Bank withdraw and deposit funds through 200,000 agents of Tigo Pesa. With this move, I expect to see more mobile money companies opening access to their agent’s network for other players in a way that adds value to the entire ecosystem.

📑 Read of the week

• Opportunities for Generative AI in Financial Services. (ThisWeekInFintech)
• African startups and investors must now make a case for their existence as funding dries up. (Techpoint)
• How Pezesha, MarketForce CEOs Made Peace in Liquidation Dispute.(Kenyanwallstreet)
• Towards Generative Credit. (Medium)
• Despite Desires for Digital Tech, Adoption Faces Challenges in Africa. (TheFintechtimes)

📖 Other News, Reads, and Media

• Nigerian fintech, Thepeer shut down and returned the remaining funds to investors.The startup raised a $2.1 million seed round in June 2022.

• The Nigerian Exchange Group (NGX) acquired a stake in Ethiopia’s first-ever securities exchange for an undisclosed amount in a fundraising that has seen the Horn of Africa nation raise $26.6 million, surpassing the target it touted to investors in 2023.
• The Bank of Tanzania (BOT) increased its interest rate (CBR) from 5.5% to 6% following a meeting held by its monetary policy committee on Wednesday.
• PiggyVest revealed plans to IPO.

• Bank of Ghana fined some Payment Service Providers( PSPs) for onboarding institutions without approval.

• Commercial Bank of Ethiopia named and shamed customers over bank glitch money.

🎥 VIDEO INTERVIEWS/DISCUSSIONS

• Why Don't Founders Like the Media? Discussion with African Ecosystem players from companies like Moniepoint and Paga.

🦉 Tweet of the Week

🎯 Fintech Opportunities

• Remote is hiring for Group Product Manager.
• FairMoney is hiring for Senior Product Manager - lending.

Made in Tanzania 🇹🇿 with 💚

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