Nigerian API fintech companies are attracting eyes of the investors

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Nigeria-based API fintech companies are raising funds to expand their market share in the embedded finance market. As the demand for embedded products such as embedded insurance, embedded lending and embedded payment is rising in the region, PayNXT360 expects these companies to raise more funds to expand their business across the region. For instance,

In November 2021, OnePipe, a Nigerian embedded finance company, attracted the eye of investors and raised a US$3.5 million seed funding round co-led by Atlantica Ventures, Tribe Capital, and V&R Associates. The round was also led by Canaan Partners, Saison Capital, Norrsken, The Fund, and Two Culture Cap, and existing investors such as Chris Adelsbach, Techstars, Ingressive Capital, Acquity, P1, Raba, and DFS Lab.

The company would act as an aggregator of APIs from different banks and fintech companies into a standard gateway, which makes the companies easy to partner with others. However, with less business, the company entered into embedded finance. Presently, the company operates under the model where it partners with six banks and runs the API infrastructure on their behalf, thus helping them monetize it while working with non-financial institutions to launch and cross-sell financial services to their customers.

Moreover, in December 2020, OnePipe raised US$950k pre-seed funding to offer embedded banking in African markets. Notably, the company, through its embedded finance infrastructure, supports both traditional and financial service businesses to increase customer loyalty and revenue by providing the customers with third-party financial products. Consequently, with a huge number of informal, unbanked, and underbanked businesses in the region, OnePipe's embedded financial service will strengthen financial inclusion for the businesses. The company has already processed 6.3 million transactions from around 140 businesses and has now issued close to one million individual accounts.

Another Nigerian API fintech that attracted investors is Mono. The company raised US$15 million in Series A funding in October 2021 to easily connect the bank accounts of the users to financial apps. Tiger Global led the funding round and was supported by new investors like Target Global (an investor in neobank Kuda), General Catalyst, and SBI Investment.

Mono provides DirectPay, a service that helps Nigerian companies to accept bank transfer payments from consumers via their website or mobile app. With half of the Africans being unbanked or with limited access to financial services, open finance providers will achieve much success in the medium to long run. The company opined to have handled over 200 million financial data transactions from around 270 companies, developers, and fintech companies.

To know more and gain a deeper understanding of the embedded finance market in Nigeria, click here.