Payday, the innovative bank that offers global payments accounts denominated in USD, EUR and GBP to Africans, has secured $3 million in a seed funding round to bolster its “future of work” initiative.
The oversubscribed funding round was spearheaded by Moniepoint Inc., the US-based entity that houses Moniepoint Microfinance Bank and TeamApt Nigeria, and included participation from Techstars, HoaQ, DFS Lab’s Stellar Africa Fund, Ingressive Capital Fund II, and angel investors such as Dare Okoudjou, MFS Africa’s CEO, and Tola Onayemi, CEO of Norebase. Techstars and Angels Touch, Payday’s existing investors, also contributed to the round.
With more than $5 million raised to date, Payday plans to obtain operational licensing in the UK and Canada, expand its team, and increase its marketing efforts while building out operations in the UK, where the startup has recently been incorporated. The fintech company, based in Kigali and Vancouver, is on a mission to transform the financial industry in Africa and beyond.
The startup has amassed remarkable traction since its inception. Despite concluding 2022 with a modest tally of just over 100,000 customers, the fintech has since expanded its virtual card selection and product lineup, catering to over 300,000 users. Furthermore, Payday processes an impressive average of 40,000 transactions each day, amounting to a monthly sum exceeding $25 million. Such remarkable figures have even tempted a unicorn corporation from the continent to extend a generous $15 million acquisition offer, only to be declined as per the company’s statement.
Despite a tripling in the fintech’s burn rate due to a rigorous marketing campaign, CEO and Founder of Payday, Favour Ori assures that the company remains profitable. The CEO reported that the startup achieved profitability in August 2022. Additionally, the fintech’s monthly revenues have surged fourfold thanks to a rapidly growing user base and the fees charged on transactions.
Commenting on the fundraise, Ori said, “We’re thrilled that this round of funding will lay the foundation for the continued growth of our platform as we expand our services to a wider audience. This investment represents a significant milestone for our company and we are grateful for the trust and commitment shown by our investors both existing and new.
We’re amped to scale our platform and reach more Africans, not only on the continent, but around the world. Our passion for empowering individuals and businesses with convenient and secure payment solutions is tangible, and we believe that this funding will allow us to do so on an even greater scale.
“Our goal remains the same: to make it easy and accessible for anyone to access their payments when on the continent, and with this new funding, we are one step closer to achieving that vision,” concluded Ori.
Also, Moniepoint CEO, Tosin Eniolorunda said, “At Moniepoint, we’re excited about the unique things Favour and the team are doing with PayDay. Personally, I connect deeply with his drive, technical depth, and desire to execute. This is something that isn’t very common, and the urge to encourage that fire inspired us to want to be a part of this.
“There’s also the alignment in our goal to provide financial happiness by addressing key international payment pain points with merchants and individuals. We see a potential to leverage their infrastructure to further deepen our suite of financial services for merchants as well, and we’re looking forward to all that’s to come.”
The two-year-old fintech has also partnered with SpaceX’s Starlink, allowing users in Nigeria and Rwanda to purchase Starlink routers through their platform. This groundbreaking collaboration has already processed nearly $1 million, solidifying the fintech’s position as a leader in the industry.