Payday Raises $3 Million in Seed Round Led by Moniepoint

New Funding Round Brings Payday’s Total Investment to $5.1 Million

Payday, a rapidly expanding pan-African neobank, has announced that it has raised $3 million in a seed round led by Moniepoint, with participation from DFS Lab’s Stellar Africa Fund, Ingressive Capital Fund II, HoaQ, and several angel investors such as Dare Okoudjou and Tola Onayemi. Existing investors, Techstars, Angels Touch, Ingressive Capital, and Now Venture Partners, made new investments in this round.

This round of funding has brought Payday’s total investment to $5.1 million. Payday was launched in June 2021 from Rwanda to provide a global payment platform for Africa, with a use case for remote African workers to receive payments from their employers and spend the money anywhere in the world. The fintech startup now operates in Rwanda, Nigeria, and the UK, and enables users to send and receive money in 23 currencies.

Payday processes an average of 40,000 transactions per day worth millions of dollars and adds 100,000 new users each month. The company currently has more than 330,000 users. This funding will help Payday expand its services and talent base, as well as obtain a license to launch its UK operations and expand into Canada.

Payday’s Evolution to a Super-App

Less than two years after its launch, Payday launched its latest product, Payday 3.0, which signals an evolution to a super-app. Payday 3.0 offers features such as local bill payments, virtual naira cards, and payment links. Also, Payday became a payment partner for Starlink, allowing users in Nigeria and Rwanda to purchase Starlink by using Payday as a payment method.

Two new talents are joining the Payday co-founding team: Elijah Kingson as CPO and Yvonne Obike as COO. Kingson previously led product design for subscription products at Revolut. Obike drove MSME growth at Nigeria’s Bank of Industry, the country’s oldest and most significant development institution.

Investor Comments

Tosin Eniolorunda, CEO of Moniepoint, said that the investment represents a significant milestone for both companies and that there is potential to leverage Payday’s infrastructure to deepen Moniepoint’s suite of financial services for merchants.

Favour Ori, CEO and Founder of Payday, said that this funding would allow the company to continue empowering individuals and businesses with convenient and secure payment solutions. Maya Horgan Famodou, Founder and MD at Ingressive Capital, described Favour as one of the savviest entrepreneurs she had met and said that Payday was indeed a gem in their portfolio.

Market Competition

Payday’s expansion to the UK and Canada places it in direct competition with other neobanks and platforms that offer remittance and cross-border payments services in Africa, such as Kuda, Afriex, Send by Flutterwave, and Lemonade Finance. As more African emigrants continue to send money back home, the pie is expected to grow larger, and the market competition will get fiercer.

The Race to Become the Market Leader

As Payday raises substantial funds to expand its services, the race to become the market leader is getting more intense. Only time will tell who will emerge as the winner in the remittance and cross-border payment market in Africa.

Credit: https://www.benjamindada.com/payday-raise-3-million-seed-funding/

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