Japanese Venture Capital SoftBank Vision Fund 2 led a $400 million Investment round for OPay, making it’s first investment bet in an African Startup. Opay has to date received about $570 million investment and the Nigerian mobile-payment platform is now valued at $2 billion, nailing it’s spot in the list of unicorn startups in Nigeria.
Also participating in the round were Sequoia Capital China, DragonBall Capital, the venture arm of Chinese food-delivery giant Meituan, Redpoint China, Source Code Capital, SoftBank Ventures Asia and 3W Capital, according to OPay.
About three months ago, there had been speculations the company was gearing up for another raise, this news only confirms the rumours. The new financing also comes two years after OPay announced two funding rounds in 2019 — $50 million in June and a $120 million Series B in November.
In a statement, OPay CEO Yahui Zhou said
“we want to be the power that helps emerging markets reach faster economic development.”
The African-focused Fintech company, founded in 2018, had an exclusive presence in Nigeria before last year. OPay previously offered ride-hailing and logistics services in a few states in Nigeria, especially Lagos and Ibadan, but shut down the ride-hailing service last year due to a government ban on motorcycles in Lagos. Opay is rated by techibytes as top 10 Fintech companies in Nigeria.
Right now, it’s the company’s mobile money and payment arm that thrives the most and drives it’s growth. By simply enabling unbanked and underbanked users in Nigeria to send and receive money and pay bills through a network of thousands of agents, OPay has grown at an exponential rate.
OPay operates in a highly competitive fintech space, where other mobile-payment platform like Paga and TeamApt are equally working hard to increase their market share as they aim to bring financial services to the millions of unbanked and underbanked Nigerians.
According to a GSMA report, Africa had more than 160 million active mobile money users generating over $495 billion in transaction value last year.
Parent company of the mobile-payment platform Opera, reported that Opay experienced massive growth during the global pandemic lockdown last year with the value of its gross transactions rising by 4.5x to over $2 billion in December.
OPay also claims to process about 80% of bank transfers among mobile money operators in Nigeria and 20% of the country’s non-merchant point of sales (POS) transactions.
Currently, the company’s monthly transaction volumes exceed $3 billion, driven by its strong network of over 300,000 agents and 5 million registered app users.
What’s next for Opay?
With the new investment, OPay plans to expand to other African countries as well as focus on the Middle East. Attempts to enter South Africa and Kenya haven’t been successful, which it blames on the Covid crisis, although the company has entered North Africa with a shop in Egypt.
Last year, OPay revealed the acquisition of an international money transfer license, in addition to a WorldRemit partnership it said was in the works..
“We believe our investment will help the company extend its offering to adjacent markets and replicate its successful business model in Egypt and other countries in the region,”
SoftBank Vision Fund’s managing partner, Kentaro Matsui,
Speaking on the investment in OPay.
OPay’s latest fundraise is the largest round so far in 2021 in terms of size and value, joining the list of African Startups who have received funding in 2021 and making it the second African Fintech unicorn after Flutterwave and the third unicorn startups in Nigeria after e-commerce giant Jumia. 2021 still holds lots of goodies for Fintech companies in Nigeria.
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