uda Raises $25M more led by Valar to Become the eobank for ‘Every African on the Planet’
ngrid Lunden
I think still is — the largest-ever seed round raised by a startup out of Africa, and thus as much of a milestone for the tech industry there as it was for Kuda itself. At the time of the seed round, Kuda had registered 300,000 Image Credits: Kuda customers: now, that figure has more than doubled to 650,000, and tellingly, that base is spending more money through the Kuda app. “In November we were doing about $500 million in transactions per month,” Ogundeyi said, for services like bill payments, card transactions and phone top-ups. “We closed February at $2.2 billion.” Kuda, as we described in our profile of the company when covering its seed round, is following in the footsteps of a number of other so-called “neobanks”, building a suite of banking services with a more accessible user interface and a more modern approach: you interact with the bank using 65
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a mobile app, and in addition to basic banking services, it provides tools to help people manage their money more intelligently. But Kuda is also different from many of these, specifically because it taps into some financial practices that are unique to its market. As Ogundeyi describes it, most people who are employed by companies will have “salary accounts” at banks, where companies pay in a person’s wages on a regular basis. These will typically be at incumbent banks, but they do not offer the same ranges of services to customers. No mobile apps, no facilities to buy mobile topups or make other kinds of bill payments, no AIbased calculators to figure out your monthly spend and provide suggestions on how to manage your budget, and so on. That has opened a gap in the market for others to provide those services in their place. Kuda’s deposits, Ogundeyi said, typically start as basic transfers that people make from those “salary accounts” elsewhere. These start out small, maybe 20% of a person’s wages, but as those users find themselves using Kuda’s payment and other tools more, they are increasing how much they transfer in each payment period. “As the trust increases you’re naturally more comfortable having money with Kuda,” he said. The next stage from that will be people depositing money directly with Kuda. A small minority already do this, he added, although the startup “has a bit more work to do” to get more companies integrated into its platform. (This is one of the areas that will be developed with this latest round of funding.) In turn, having more money in Kuda accounts is likely to spur another wave of services being see page 66
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www.africabusinessassociation.org
