OPay, a leading Africa-focused fintech firm with Chinese backers is reportedly in talks to raise as much as $400 million in funding. The planned fundraising round comes two years after the fintech firm announced two funding rounds in 2019, a $120 million Series B in November, and a prior one in June worth $50 million.
The total $170 million raised to date mostly come from Chinese investors who have jointly started to bet big on startups in Africa over the last few years. Few of them include Source Code Capital, GSR Ventures, SoftBank Ventures Asia, IDG Capital, Sequoia Capital China, and SoftBank.
The fintech firm plays in a very competitive fintech market. Nigeria, in fact is one the most populous nations in Africa and with a huge share of its people unbanked and underbanked, fintech is perhaps the most lucrative digital sector in the country.
Mobile money services have long served the needs of the underbanked, according to GSMA, the country had above 160 million active mobile phone money users generating up to $495 billion in transaction value in 2020.
Although, fintech newcomers like Paga and OPay are trying to get hold of as much industry share as possible, but, telcos such as Airtel and MTN, with operations across numerous African countries, are now creating money service services as billion-dollar businesses to contest as well.
With all the money that the fintech startup has raised till now, it is quite astonishing that the firm until December 2020 was just present in Nigeria. None of OPay’s plans to grow to Kenya and South Africa has come to completion yet. Though OPay blamed the global pandemic for the failings, it has however established a shop in North Africa by expanding to Egypt this very year.
The upcoming raise, probably a Series C, would be instrumental in the firm’s plans for expansion of geographical and product offerings. As per The Information, the valuation of OPay would boost to about $1.5 billion, nearly three times of what it was in 2019.