Capria VC wants to back two more African Series A startups with $1-$3 million each
Capria VC, a global venture firm with $207 million in assets under management, runs a unique model for investing in emerging markets by backing startups and local fund managers. Globally, it has invested in 17 fund managers, giving it indirect exposure to nearly 400 portfolio companies, while directly investing in only 41 startups. “This model is powerful because it gives us broad access to market insights. It’s a huge data set, which benefits both us and our portfolio companies,” Mobola da Silva, the Africa partner at Capria, told TechCabal. Capria’s African partners are Global Ventures, Lateral Frontiers and Atlantica Ventures. She joined Capria in 2023 initially as a venture partner before transitioning to a partner in 2024 and relocating from Lagos to Nairobi to strengthen Capria’s on-ground presence on the continent. Before joining Capria, she spent 14 years working at the intersection of venture capital and emerging markets and held senior roles at the Draper Richards Kaplan Foundation, the uMunthu Fund, and Alitheia Capital. “The common theme (of my career) is deploying capital into the most promising opportunities and backing founders best positioned to scale transformative businesses,” da Silva said. Capria invests $1-3 million in startups with capital also reserved for follow-on investments. The firm has directly invested in six African startups, focusing on sectors driving large-scale impact and innovation, like fintech, agtech, HRtech/jobtech, edtech, healthtech, and B2B SaaS. “These industries represent key areas where technology and entrepreneurship can create transformative solutions in emerging markets,” da Silva explained. It counts Moniepoint, Paymob, and Seamless HR in its direct portfolio. In MAX, it invested alongside Global Ventures, one of its partner firms. In its indirect portfolio, it is exposed to LipaLater, Klasha, and Figorr, among others in Africa. Venture capital firms are often split between investing teams and support teams that guide portfolio startups. Besides its unique investing model, Capria also has a unique support approach. It has an in-house AI team comprising four developers, founding partner Will Poole—an ex-tech entrepreneur with sector expertise—and a member of its support team. “The AI team is a resource available to all our portfolio companies. Any company can approach us and say, “We’re thinking of implementing AI in this way, but we have challenges—how can you help?” They don’t have to use the AI team, but it’s an option. Of course, there’s some prioritisation. The team can’t work with all companies simultaneously, so they phase projects depending on workload,” da Silva said. TechCabal spoke to da Silva to understand the firm’s investment thesis and plans for Africa. This interview has been edited for length and clarity. How do you source and identify promising opportunities in such a fragmented market? At Capria, we prioritise a set of core elements when evaluating startups. We look for exceptional teams, strong revenue traction, and compelling unit economics that demonstrate long-term viability. A startup’s ‘right to win’ in its market is critical, along with an asset-light model that leverages technology—particularly applied AI—to drive scale and efficiency. Additionally, we focus on companies operating in large and growing markets, ensuring they have the potential for significant market impact. Which qualities do you look for in founding teams beyond their product or service, particularly regarding resilience and cultural fit for African markets? At Capria, we evaluate founders and founding teams based on several key factors like founder-market fit. We prioritise alignment between a founder’s skills, experience, and personal qualities with the market’s needs. While this is a strong preference, we may make exceptions for serial entrepreneurs with a proven track record. We also look at their soft skills and coachability. Founders must demonstrate humility and the ability to accept feedback, as this is critical for long-term success. For younger founders, we assess strategic thinking, domain knowledge, passion, and grit—often validated through third-party references early in our diligence process. We also prefer diverse founding teams but, at a minimum, expect founders to be deeply connected within their industry ecosystem. What’s your due diligence process, from initial pitch review to deeper market and team assessments? We have a multi-step process that includes initial screening after the first conversation with the founder, first-level investment committee (IC) approval, due diligence (commercial, financial, legal, and technology), final IC approval, investment documentation, signing, and deal execution. Each step has specific tasks we follow to ensure we run a comprehensive and thorough process. How do you structure investments in Africa? We use several strategies to structure investments in Africa to mitigate the effects of macro risks like portfolio diversification. Capria diversifies investments across different sectors, stages, and regions within Africa, helping spread risk and reduce the impact of volatility in any one area. We also collaborate with local partners who have deep market knowledge and experience is invaluable. They provide insights into navigating the specific challenges and opportunities of the local market. Capria emphasises that strong corporate governance and financial controls within portfolio companies are crucial. This helps ensure transparency, accountability, and efficient use of capital, which are essential in uncertain environments. In some instances, mechanisms such as liquidation preferences or anti-dilution clauses protect against unfavourable market conditions or company performance. You focus on Series A and beyond, avoiding seed-stage startups. Why is that? Our sweet spot is Series A. We rarely invest at seed—definitely not pre-seed—but we’ve made some exceptions. Is it because seed-stage startups are riskier, especially in Africa? Yes, largely. At Series A, while a startup isn’t entirely de-risked, certain risks are reduced. By then, a company should have demonstrated product-market fit and a scalable, repeatable business model. Seed-stage startups are still figuring those things out. Series A funding is meant to scale a proven model. That said, we do invest in seed through some of our India-focused funds, so we’re not completely unfamiliar with it. But for our Africa fund, this is our strategy. What’s your ideal startup? Our strategy is Series A tech-enabled companies in key sectors like fintech (which makes up ~50% of our Africa portfolio), agtech, jobtech and B2B SaaS. We
Read MoreHow South Africa’s Tregter is using WhatsApp chatbots for data collection
In South Africa, where WhatsApp dominates as the most widely used social media platform, the messaging app is evolving beyond just helping people communicate and get services. Tregter, a Cape Town-based startup established in 2019, uses WhatsApp chatbots to gather data for research, even in underserved rural communities. “A big use case for chatbots is data collection,” says Ferdinand Steenkamp, Tregter’s co-founder. “We have assisted multiple vendors with building chatbots, whether that could be to get information out to their clients, or whether they want to collect data more easily.” Tregter works with the Do More Foundation, an organisation that aims to improve the lives of children in South Africa’s underserved communities. “This is a pro bono project, using WhatsApp chatbot to collect data on early childhood development across rural South Africa. This allows the foundation to scale their data collection efforts and target rural communities,” Steenkamp explains. WhatsApp chatbot for the Do More Foundation is accompanied with cloud-based and analytics solutions. Steenkamp notes that the deployment of a WhatsApp chatbot is a hybrid approach combining the accessibility of a mobile messaging platform (WhatsApp) with a cloud-based platform, which, amongst other things, consists of a database where they can collect and analyse large volumes of data securely. “We also created a platform for analysts where they can inspect and visualise their data,” Steenkamp says. This initiative demonstrates how chatbots can facilitate essential research in areas where access is often limited. Tregter operates in a competitive space where several companies are also using data-driven strategies and chatbot technologies. South Africa has over 40 chatbot startups, with about three new companies opening each year in the last decade, Tracxna data shows. However, WhatsApp chatbots are dominant due to WhatsApp’s widespread use—about 40% of South Africans use the platform. Most of these WhatsApp chatbots focus on customer service, sales, scheduling, and information dissemination. Tregter is exploring a growing area of using chatbots for research. By focusing on underserved rural communities and the use of WhatsApp chatbots.Tregter is betting on accessibility of WhatsApp which makes it an ideal platform for reaching diverse populations, including those in rural areas. “What a lot of companies were doing before was manually collecting data. So they would have a single person responsible for capturing data. This process was not only time-consuming but also prone to errors and inconsistencies,” says Steenkamp. By automating data collection through chatbots, Tregter significantly improves data quality and reduces the time required to gather insights. “We found an instant improvement in data quality and also a massive reduction in the time it takes to get from data received to insights because we have built validations into the data capturing, and it all happens automatically. Once it is captured, it is live, and anyone has access to that data,” Steenkamp says. Beyond research, Tregter sees WhatsApp as the future of customer interaction. “WhatsApp is the app that everybody has,” Steenkamp states. He argues that companies investing millions in bespoke mobile apps for data collection are often missing the mark, as users are reluctant to download numerous apps and some affordable phones in South Africa often do not have space for many apps. As a startup, security and privacy are top priorities. Steenkamp highlights the significance of cloud migration and ensuring users have the necessary access for their tasks while maintaining data protection. “A great first start would be to move to the cloud where, I would not say it is secure by default, but you get a lot more security features,” he explains. Despite these challenges, Tregter remains bootstrapped, focusing on proving product-market fit before seeking external funding. “We do not believe in this idea of taking money and then hoping to find something that works,” Steenkamp says, highlighting a practical approach to startup growth. The company is actively working on producing its solutions, aiming to launch a SaaS platform to reach a wider audience. As AI-powered chatbots evolve, Tregter is keenly aware of the need to adapt to the African context. “We have to look at the customer in South Africa and throughout Africa, and just find out if we can implement those technologies in a way that works for them,” Steenkamp cautions. While AI, voice assistants and augmented reality hold promise, Tregter’s focus remains on leveraging existing platforms like WhatsApp to bridge digital literacy gaps and deliver tangible value. “Most of the population in South Africa understands how WhatsApp works, and so there is immediately a gap that gets bridged,” Steenkamp says.
Read MoreTouch and Pay fuels 291% growth in prepaid card usage in Nigeria
Touch and Pay (TAP) Technologies Limited, the fintech company behind Cowry card for Lagos’ train and Bus Rapid Transit (BRT) systems, has driven a 291% surge in closed loop prepaid cards usage between 2021 and 2024, according to a report by global market research firm Euromonitor International. Closed-loop prepaid cards are preloaded with funds but can only be used within a specific network or with designated merchants. This growth highlights the increasing adoption of cashless payments, particularly in Nigeria’s largely informal transportation sector. Cashless payments reduce the time and hassle associated with cash transactions and the risk of theft and robbery, which are common issues in the sector. The number of closed loop prepaid card transactions in Nigeria jumped from 2.2 million in 2021 to 8.6 million in 2024, with transaction value rising from ₦6.16 billion to ₦18.03 billion over the same period. TAP is the primary payment provider for Lagos State’s mass transit system, its largest market, though specific data for Lagos was not disclosed. “The rise of prepaid cards is linked to road infrastructure developments and the launch of the Lagos Blue Line train, which has driven demand for Cowry cards since their introduction in 2021,” the Euromonitor report noted. TAP launched its Cowry card in 2020 and now has over five million users, up from 3.8 million in 2023. CEO Olamide Afolabi told TechCabal that 552,000 cards were issued in 2024, surpassing the 400,000 issued in 2023. The company claims to have processed over ₦20 billion in transactions last year. “To use the BRT system, commuters must have a Cowry card. We are the sole provider of the card payment system for transportation in Lagos and several other states,” Afolabi said. Cowry cards, sold for ₦1,000, are contactless payment cards powered by near-field communication (NFC) technology, enabling users to pay for bus and train rides. Funds can be added through the Cowry Wallet app, which also offers a pay-with-phone feature, though most commuters prefer to top up via bank transfers or agents. Lagos resident and consumer data analyst Precious Kuye, who bought her Cowry card in 2021 for ₦400, has used it daily for commuting. “I can easily add money through the app or at the terminal,” she said. Deborah Innocent, a graphic artist, finds the Cowry card more convenient than relying on unpredictable commercial buses. “It’s user-friendly and much easier to use,” she said. In August 2024, SmartCash Payment Service Bank, a subsidiary of Airtel Nigeria, partnered with TAP to introduce new top-up features for Cowry cards. “The growth in card usage demonstrates how technology can subtly influence consumer behavior, even in unstructured markets,” said Uchenna Uzo, professor of marketing at Lagos Business School. “ It underscores the critical role of user adoption in Nigeria’s payment ecosystem—a market that deserves close attention. A thriving retail sector depends on a seamless digital payment system.” While challenges remain, there is growing awareness of the benefits of a cashless transportation system in Nigeria. As adoption spreads, the sector will further integrate digital payments, making seamless, cash-free travel a reality for millions.
Read MoreStarlink, now Nigeria’s second largest internet service provider, delays tariff hike
Starlink, the satellite internet service operated by SpaceX, has become Nigeria’s second-largest internet service provider (ISP), overtaking FiberOne Broadband Limited in Q4 2024, according to data from the Nigerian Communications Commission (NCC). Despite its premium pricing, Starlink’s user base more than doubled within a year, surging from 23,897 subscribers in 2023 to 65,564 by the end of 2024. This rapid growth reflects the increasing demand for its high-speed connectivity, which delivers speeds of up to 250 Mbps—far exceeding what most local ISPs offer. Despite a decline in subscribers, Spectranet remains the market leader. Its subscriber base declined from 113,869 at the end of 2023 to 105,441 in Q3 2024, a loss of 8,428 users, according to NCC data. This number remained unchanged in Q4. Unlike Starlink, which operates via satellite, Spectranet depends on fiber and terrestrial wireless networks—both of which require expensive right-of-way fees, tower installations, and power infrastructure. Starlink’s growth comes amid growing consumer complaints of persistent poor internet quality offered by mobile network operators and ISPs. Unlike its competitors, the satellite internet provider continues to expand its satellite network globally, improving speeds, reducing latency, and enhancing service reliability. As of February 2025, SpaceX had launched 8,039 Starlink satellites, 7,082 of which were still in orbit and 7,049 operational. “As far as them (Starlink) being the second-largest ISP now, it makes sense,” said Ladi Okuneye, CEO of UniCloud, an ISP. “Satellite technology’s ubiquitous nature means you can connect a customer today in Ikoyi and another in Ikot Ekpene without being restricted by the geographical limitations of fiber or terrestrial wireless solutions.” In December 2024, Starlink announced an increase in its monthly subscription fees in Nigeria, doubling the cost of its standard residential service from ₦38,000 to ₦75,000 per month. The hike affected new customers, while existing users were set to transition to the new rate on January 27, 2025. However, as demand surged, Starlink put the tariff adjustment on hold. This wasn’t the first time Starlink faced pricing challenges in Nigeria. In October 2024, the Nigerian Communications Commission (NCC) blocked a previous attempt to raise tariffs, saying the company had not followed the proper regulatory procedures. The NCC later approved the hike on February 4, 2024, allowing telecom operators to adjust their prices. However, while operators such as MTN Nigeria, Airtel Nigeria, and Smile Communications have increased their prices, Starlink has yet to implement the increase. Despite its rapid growth, Starlink faces limitations. Currently, subscribers can only use the service in a fixed location, making it difficult for mobile users to stay connected on the move. In 2024, Starlink began rolling out satellite-to-phone connectivity to eliminate mobile dead zones, but this service has not yet reached Africa. As demand for reliable internet access grows, Starlink’s expanding presence in Nigeria signals a shift in the country’s broadband landscape. However, regulatory hurdles, pricing concerns, and mobile connectivity challenges remain key factors in its long-term success.
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Next Wave: Kenyan government services turning into pay-to-access schemes
Cet article est aussi disponible en français <!– In partnership with –> <!–TopBanner Join us for TechCabal Battlefield, Moonshot’s startup competition where you can showcase your startup idea to a global audience and an esteemed panel of judges and stand a chance to win up to 2.5 million naira in funding for your business! Click to register for TC Battlefield First published 09 March, 2025 Image: eCitizen The recent revelations about the e-Citizen platform and its financial irregularities raise concerns about the management and future of digital government services in Kenya. At least KES 144 million ($1.1 million) collected through the platform is unaccounted for, adding to its history of mismanagement. These issues arise amid discussions on privatising key government functions. The state still relies on Webmasters Kenya, a private firm, to manage the platform years after winning a court case over its ownership. Webmasters Kenya’s proposal to introduce premium charges for expedited services fuels speculation that the government is considering a subscription-based model that could limit access to public services. Yet some think that this is a good idea. The assumption that private corporations provide government services more efficiently and at a lower cost is flawed. This theory rests on the belief that bureaucratic inefficiencies make government service provision expensive, while private firms, with better management and cost-saving techniques, can operate more effectively while making a profit. However, research shows otherwise. When essential services are privatised, governments often fail to anticipate requirements, which could lead to costly contract modifications and unforeseen expenses. Businesses prioritise profit over public interest. The e-Citizen case illustrates these risks. While digital platforms improve efficiency, they also introduce new dangers when managed by private entities focused on financial gain. Despite the government’s legal victory, Webmasters Kenya’s continued control over the platform raises concerns about contractual loopholes and the state’s ability to maintain public control over critical digital infrastructure. The missing KES 144 million highlights the lack of transparency in managing public funds. These irregularities mirror past corruption cases linked to e-Citizen, including the KES 5.6 billion ($44 million) probe that implicated treasury officials and private sector executives. Such incidents show the dangers of allowing private firms to control essential government services without strict oversight. Privatising public services shifts incentives. Unlike government agencies, which respond to political will and public demand, private firms operate for profit. This often leads to cost-cutting that reduces service quality, increases fees, and excludes lower-income users. For services that function as natural monopolies, such as banking, healthcare, and transportation, privatisation has historically increased costs and reduced access rather than improved efficiency. A similar pattern is emerging with e-Citizen, where premium charges for expedited services risk creating a two-tiered system—those who can afford to pay for faster service while others endure delays. Premium charges raise fundamental questions about government service delivery. If implemented, they could set a precedent for broader pay-to-access services and contradict the principle that essential government functions should be accessible to all. This follows a global trend of public service monetisation, often justified in the name of efficiency. In the U.S., for instance, healthcare privatisation has led to exorbitant costs, with corporate profiteering taking priority over service quality. Kenya’s approach to e-Citizen seems headed in a similar direction, where private firms dictate access and pricing. One of the biggest risks of privatising government services is the lack of long-term commitment to public welfare. While most Kenyans may disagree, government employees often go beyond their formal job descriptions to keep services running despite inefficiencies. Private contractors, however, operate strictly within contract terms, demanding extra compensation for additional work. This becomes problematic for essential services that require flexibility. A subscription model for e-Citizen would worsen this, as private entities would prioritise revenue over equitable service access. Kenya’s slow and inefficient public services, such as those provided by the National Transport and Safety Authority (NTSA), have fuelled arguments for privatisation. A visit to NTSA offices can take an entire day, even with an appointment. However, the solution is not necessarily privatisation but internal reforms addressing bureaucratic bottlenecks. Many inefficiencies stem from poor management, outdated processes, and corruption, not an inherent inability of the government to provide quality services. Handing services to private firms without addressing these issues simply shifts the problem rather than solving it. The government’s budgeting approach also contributes to inefficiencies. The current model incentivises departments to exhaust their budgets to avoid future reductions. This simply encourages wastage. While this inefficiency is often cited as a reason for privatisation, shifting to a profit-driven model does not necessarily solve the problem. Instead, it introduces new challenges, such as inflated service costs and exclusionary practices that disadvantage lower-income citizens. The proposal for premium charges on e-Citizen services reflects a broader trend of creeping privatisation, where essential government functions are subjected to market forces. If left unchecked, this could lead to a scenario where access to basic services depends on financial ability rather than citizenship rights. Kenn Abuya Senior Reporter, TechCabal Thank you for reading this far. Feel free to email kenn[at]bigcabal.com, with your thoughts about this edition of NextWave. Or just click reply to share your thoughts and feedback. We’d love to hear from you Psst! Down here! Thanks for reading today’s Next Wave. Please share. Or subscribe if someone shared it to you here for free to get fresh perspectives on the progress of digital innovation in Africa every Sunday. As always feel free to email a reply or response to this essay. I enjoy reading those emails a lot. TC Daily newsletter is out daily (Mon – Fri) brief of all the technology and business stories you need to know. Get it in your inbox each weekday at 7 AM (WAT). Follow TechCabal on Twitter, Instagram, Facebook, and LinkedIn to stay engaged in our real-time conversations on tech and innovation in Africa. If you liked this edition of Next Wave, please share with your friends. And feel free to reply with thoughts and feedback. We welcome those. 18, Nnobi
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Next Wave: As banks face scrutiny, Kenya’s corrupt turn to credit unions
Cet article est aussi disponible en français <!– In partnership with –> <!–TopBanner Join us for TechCabal Battlefield, Moonshot’s startup competition where you can showcase your startup idea to a global audience and an esteemed panel of judges and stand a chance to win up to 2.5 million naira in funding for your business! Click to register for TC Battlefield First published 02 March, 2025 It’s disheartening to see how Kenya’s credit unions, popularly known as Saccos (Savings and Credit Cooperative Organisations), are now grappling with some serious financial issues. These Saccos manage approximately KES 759 billion ($5.9 billion) in loans across 357 regulated entities that serve 6.84 million members. These are huge figures by Kenyan and African standards, with 70% of Africa’s Saccos based in Kenya. The country has the largest Sacco industry on the continent by asset size, with over 13,500 Saccos. Regulated Saccos collectively hold $4.36 billion in savings and shares, with total assets reaching $6.20 billion. The sector’s penetration rate stands at an impressive 20.7%. You can’t be faulted if you don’t understand why Saccos are so big in Kenya (they have been instrumental in helping households pay school fees, build homes, and accumulate some wealth). Traditionally, and maybe through no fault of their own, banks prioritise their biggest clients, so they often leave ordinary customers as an afterthought. A bank’s goal isn’t just to hold your money but to extract as much of it as possible through endless fees and hidden charges. Tough but understandable. Worse, the relationship is adversarial rather than supportive. If there’s ever a dispute, the bank assumes you’re wrong. As profit-driven institutions, banks aren’t in the business of serving customers but maximising returns, often through temporary perks as bait before imposing harsher terms. While they follow regulations, they do the bare minimum, and offer no flexibility, fairness, or even basic courtesy unless absolutely necessary. This is where Saccos come in, where mutual respect is the rule rather than the exception. However, take the recent KUSCCO fiasco, for instance. The Kenya Union of Savings and Credit Cooperatives, Kenya’s Saccos’ umbrella body, is under the microscope for alleged financial mismanagement that has cost Sacco members (note, Saccos refers to them as ‘members’ rather than ‘customers’) over KES 13 billion ($101 million). A forensic audit by PwC was handed over to the Inspector General of Police to start investigations into these irregularities. The cabinet secretary (minister) for Cooperatives and MSMEs, Wycliffe Oparanya, promised stern action against anyone guilty of misappropriating members’ funds. But here’s where it gets murky. Despite these bold declarations, there’s a lingering sense that Kenya’s Sacco financial regulations are intentionally lax and have created a playground for the corrupt since at least three similar Sacco corruption cases were reported in 2024 alone. It’s as if the system is designed to be porous, which has allowed grand corruption cases to go unpunished. Some Saccos have partaken in dubious activities, including taking out bank loans to pay dividends, which contradicts sound financial management principles and jeopardises the cooperative movement’s stability. There are alarming disparities in dividend distributions across the sector, with some Saccos offering rates exceeding 20%. While attractive in the short term, such high payouts can mask underlying financial issues and threaten long-term sustainability. The Central Bank of Kenya (CBK) has mandated that banks increase their core capital from KES 1 billion to KES 10 billion by December 31, 2029, with annual increments between KES 1 billion and KES 2 billion. In contrast, deposit-taking Saccos are required by the Sacco Societies Regulatory Authority (SASRA) to maintain a minimum core capital of only KES 10 million. This disparity underscores the more relaxed regulatory environment governing Saccos. The government plans to oversee the appointment of Sacco directors and impose term limits to enhance corporate governance. The plan may address issues such as embezzlement of members’ savings and failure to refund share capital to exiting members. Comprehensive reforms are desperately needed if policymakers and stakeholders are serious about safeguarding members’ interests and rescuing the sector’s already decaying public perception. Aligning Sacco regulations more closely with those of traditional banks seems to be an obvious step since it can help mitigate risks associated with financial mismanagement and corruption. Dividend policies that tie payouts to actual financial performance can prevent the unsustainable high returns that some Saccos offer, which is also a policy that can protect members’ savings. Otherwise, the Sacco sector will remain vulnerable to ongoing corruption and financial instability and undo good work about financial inclusion and economic growth for people who reaped from them at a time when banks did not welcome them. Kenn Abuya Senior Reporter, TechCabal Thank you for reading this far. Feel free to email kenn[at]bigcabal.com, with your thoughts about this edition of NextWave. Or just click reply to share your thoughts and feedback. We’d love to hear from you Psst! Down here! Thanks for reading today’s Next Wave. Please share. Or subscribe if someone shared it to you here for free to get fresh perspectives on the progress of digital innovation in Africa every Sunday. As always feel free to email a reply or response to this essay. I enjoy reading those emails a lot. TC Daily newsletter is out daily (Mon – Fri) brief of all the technology and business stories you need to know. Get it in your inbox each weekday at 7 AM (WAT). Follow TechCabal on Twitter, Instagram, Facebook, and LinkedIn to stay engaged in our real-time conversations on tech and innovation in Africa. If you liked this edition of Next Wave, please share with your friends. And feel free to reply with thoughts and feedback. We welcome those. 18, Nnobi Street, Surulere, Lagos, Nigeria View in Map You received this email because you signed up on our website or made purchase from us. If you know longer wish to recieve these emails, please unsubscribe
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TechCabal Daily – Tap. Pay. Access
In partnership with Lire en Français اقرأ هذا باللغة العربية Good morning Join the TechCabal community on TikTok! We’re bringing the conversation about African tech to a new level with exclusive content, behind-the-scenes glimpses, and more. Follow us @techcabal and let’s build the future of tech together. Access Bank launches Tap to Phone in Nigeria Safaricom remains silent on Mali fund as it pushes Ziidi Zipline to launch in five more Nigerian states World Wide Web 3 Job Openings Banking Access Bank launches Tap to Phone in Nigeria Image Source: Google The race for contactless payments in Nigeria is heating up, with key players positioning themselves to crack this form of payment. While not new, contactless payments have long been a sleeper innovation in the country, held back by a lack of infrastructure, customer awareness, and adoption. Access Bank, Nigeria’s largest bank by assets, has launched a Tap to Phone solution to expose the average Nigerian to contactless payments. Tap to Phone uses software point-of-sale (softPOS) technology, where merchants download an app and use their smartphones as POS terminals. With a Near Field Communication (NFC)-enabled card, customers can withdraw by simply bringing their cards near the smartphone without needing to slot them in. This isn’t Access Bank’s first foray into contactless payments. It previously launched QR code capture payment technology, where users scan pre-generated QR codes to pay for goods and services. However, the bank hasn’t disclosed transaction numbers or how that technology is performing. With softPOS, Access Bank joins existing players like Kuda softPOS, which provides tap to phone functionalities in its business banking suite. Fintech rivals Moniepoint and PalmPay are also pushing contactless payments. Moniepoint partnered with AfriGO to introduce cards, while PalmPay teamed up with CashAfrica, a Nigerian contactless payments infrastructure provider, to launch payment terminals. This hyper-activity reflects a belief that contactless payments are the future. While infrastructural blockers are solvable, a deeper psychological block around security remains. How can users maintain control of their financial access if they lose their phones or cards? The Central Bank of Nigeria (CBN) has introduced daily cumulative limits capped at ₦50,000 ($33) to prevent heavy losses in cases of theft. However, building security-first solutions is crucial. In countries where contactless payments are entrenched, authorisation is key. Although providing authorised access to every payment is less user-friendly, it is efficient. Yet, the next will be making authorisation overrides difficult in those cases of theft. With the country’s biggest bank throwing its hat in the race for contactless payment adoption, one needs no telling that contactless payments may be about to take off in Africa’s biggest economy. Are you a freelancer or remote worker? Fincra wants to understand the challenges and opportunities related to cross-border work payments for freelancers and remote workers in Nigeria. Please take just a few minutes to complete this survey. Companies Safaricom remains silent on Mali fund as it pushes Ziidi Image source: M-Pesa at 18. Safaricom, Kenya’s largest telco, is making a strong push for its new Ziidi Money Market Fund (MMF), but the move hasn’t been without drama. While Ziidi has already racked up over one million sign-ups and KES 6 billion ($46 million) in funds, customers and industry insiders are raising questions about Mali, Safaricom’s first MMF, which now appears to be on shaky ground. Mali, launched in partnership with Genghis Capital in 2020, was once a promising product. However, its growth stalled amid technical issues and regulatory hurdles. Now, Genghis Capital is accusing Safaricom of “business fraud” and claims the telecom operator intentionally orchestrated Mali’s decline while quietly building Ziidi with new partners. Some users were allegedly migrated to Ziidi without consent, sparking legal battles and concerns over data privacy violations. The money market fund space in Kenya is heating up. With KES 254 billion ($1.9 billion) in total assets under management, these funds are becoming a go-to investment option. Money market funds account for over 67.4% of all investments, offering better returns than traditional bank savings. Safaricom is clearly eyeing a bigger slice of this growing market by embedding Ziidi into M-PESA, making investing as easy as sending mobile money. This transition raises key questions. What happens to Mali investors? Will Safaricom compensate them if the fund collapses? The silence from both Safaricom and Genghis Capital fuels speculation. As digital investments become more mainstream, transparency and trust will be the real currency that determines who wins Kenya’s MMF battle. Stay up to date with the latest Paystack news Subscribe to Paystack to be among the first to know about our blog posts, product updates, events and more. Subscribe here→ Banking Zipline to launch in five more Nigerian states Image source: Zipline Zipline is offering Nigeria a lifeline. In a country where life-saving medical supplies can take hours—or even days—to reach those in need, Zipline, a US-based drone logistics company is expanding its reach across Nigeria to meet the need. The company which currently operates in Bayelsa, Kaduna and Cross River recently partnered with the Nigerian government, allowing it to use its drone infrastructure to deliver essential medical supplies to remote and underserved areas across the country. Since launching in Nigeria in 2022, Zipline has been using its high-speed autonomous drones to deliver life-saving medical supplies to hard-to-reach communities, cutting delivery times from hours or even days to just 30 minutes. Zipline is also negotiating new state partnerships to establish a total of seven drone deployment stations—“nests” that can serve vast areas, overcoming the country’s logistical and infrastructure challenges. The company’s ambition doesn’t stop at healthcare. While Zipline is focused on expanding its medical delivery services in Nigeria, it is also exploring drone logistics for agriculture and e-commerce. While Nigeria’s size and complexity will present a new challenge for Zipline, the company has proven expertise across eight countries—including Rwanda and Ghana—in four continents. Get notified when the Moonshot Deal Book goes live The Moonshot Book Dealbook is lauching very soon. 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Read MoreCarbon resumes issuance of debit cards in partnership with Verve
Carbon, the Nigerian digital bank known for its loans-led approach to banking, has partnered with Verve, the Interswitch-owned card scheme to resume issuing debit cards nine months after pausing card operations, the company told customers in a February blog post. The startup previously issued Visa cards but ended that partnership due to high costs and its “cumbersome” processes. Carbon operates without an agent network or physical branches, limiting channels for cash withdrawals and online shopping. Discontinuing cards further limited its channels and the resumption of card issuance shows that despite the rise of contactless payments and bank transfers, debit cards remain one of the most effective channels for customers to access their funds. “Offering cards is not about attracting new customers to Carbon; it’s more of an essential service we provide. It’s about providing convenience and retaining our customers,” Lotanna Anuforo, Carbon’s content manager, told TechCabal in November 2024. Carbon did not immediately respond to a request for comments. Nigerian fintechs once saw Mastercard and Visa cards as a must-have to acquire young Nigerians who loved to shop online. However, rising costs for maintaining these international card schemes—which charge dollar-based fees—and reduced international customer spending have changed that thinking. Carbon began issuing debit cards in August 2021 after transitioning from a lender to a licensed microfinance bank to retain customers and drive transactions on its platform. Its cards also competed against bank-issued cards, which fintech customers often use as their primary account. Besides dollar-based costs, fintechs without physical branches must partner with logistics companies to deliver cards, increasing issuing costs. They also face a $500+ fee charged by international card schemes for logging disputes on their resolution channels. These factors have driven a shift toward Verve, which has issued over 70 million cards, cementing its dominance in the Nigerian market. Carbon’s switch to Verve, which charges in Naira, continues a trend of major Nigerian fintechs and banks opting for local card solutions. Moniepoint and OPay have issued over 17 million Verve cards, while most Nigerian banks issue Verve cards for customers. Carbon’s shift in its debit card strategy highlights that despite the rise of bank transfers and the growing adoption of contactless payments, fintechs still need debit cards—for now—despite the costs and operational challenges.
Read MoreSafaricom silent on Mali fund as it pushes replacement Ziidi
Kenya’s largest telco, Safaricom, remains tight-lipped about the fate of Mali, its first money market fund launched in 2020, as it aggressively pushes Ziidi, the newly approved replacement. Ziidi, which received regulatory approval in November 2024, is a partnership between Safaricom, Standard Investment Bank, ALA Capital Limited, and Sanlam Investments East Africa Limited. However, its rollout has been marred by controversy, with customers left in the dark about Mali’s status while Safaricom intensifies efforts to onboard users onto Ziidi. At a Friday media briefing that coincided with M-PESA’s 18th anniversary, Safaricom said Ziidi has already recorded over one million sign-ups with over KES 6 billion ($46 million) in funds. Some users were allegedly moved from Mali, which sparked a legal dispute with Mali’s fund manager, Genghis Capital. In December 2024, Genghis Capital accused Safaricom of migrating customers to Ziidi without their consent. The firm also claimed Safaricom deliberately orchestrated a liquidity crisis that would trigger mass withdrawals from Mali amid ownership disputes over the fund. The situation worsened in late December 2024 and January 2025, when Mali experienced persistent technical failure that prevented some customers from withdrawing funds or signing up. While the service remains frozen for new registrations, Ziidi remains fully operational, which fuels the speculation that Mali is being phased out. Both funds currently appear on Safaricom’s M-PESA app. Safaricom and Genghis Capital were contacted multiple times for comment but did not respond. By September 2024, Mali was Kenya’s 17th-largest collective investment scheme managing KES 3.1 billion ($24 million) in assets and bringing in KES 11.6 million ($89,000) for Safaricom in the first half of the year. Kenya’s investment funds have seen significant growth, with total assets under management rising 13% to KES 254 billion ($1.9 billion) in June, up from KES 225 billion ($1.7 billion) in March, according to data from the Capital Markets Authority (CMA). During the same period, money market funds remained the dominant choice, accounting for KES 171.2 billion ($1.3 billion) and 67.4% of total investments. The remaining assets were distributed across fixed-income, equity, and other investment categories.
Read MoreZone hits ₦1 trillion in transactions as Nigerian banks turn to blockchain
Zone, the Nigerian payments infrastructure company, has processed over ₦1 trillion in transactions on its blockchain network between November 2022 and December 2024, according to the company’s CEO, Obi Emetarom. It recorded 100 million transactions, averaging ₦10,000 per transaction. While blockchain adoption in banking remains limited, most of these transactions were processed on automated teller machines (ATMs)—a first for blockchain-powered payments at this scale in Nigeria. This milestone comes despite the decline of ATM usage. In the past three years, ATM transaction values have declined from ₦32.65 trillion in 2022 to ₦28.2 trillion in 2023, as customers shift toward Point-of-Sale (POS) terminals and digital payments. Twelve banks currently use Zone’s blockchain network, but few use the technology to process ATM transactions. “If there was wider adoption of ATMs, [reaching ₦1 trillion in transactions] would have been faster,” said Obi Emetarom, Zone CEO and co-founder. “We used the ATM as a pilot to [introduce something new]. We didn’t want to start loading our system with heavy transactions, so we chose a transaction type that is manageable to build a credible system.” While Zone’s network allows these banks to achieve faster settlement rates on ATM transactions, others are in the system for another reason: ZonePoS, which allows them to process POS payments on the blockchain. After acquiring a switching licence in 2022, Zone launched a test phase for its blockchain network on ATMs in November. The initial blocker was onboarding banks and convincing regulators that activities performed on the network could be compliant, helping them to automate many of the processes that manual audits typically revealed. The rollout in late 2022 was a successful pilot, opening the pathway for the startup to launch commercially in January 2023. Since then, Zone has worked closely with banks. “The real issue that affects traditional financial institutions is the fear of non-compliance of existing blockchains and DeFi solutions,” said Emetarom. “[Financial institutions] don’t want to risk being fined or their licences withdrawn.” Emetarom claims that Zone’s Layer-1 blockchain reaches 10,000 transactions per second (TPS) “right out of the box.” Seeing how this worked for ATMs and the surge in POS transactions, Zone extended its blockchain network to terminal payments. In June 2024, Zone expanded its blockchain network to POS terminals, and in August, the company partnered with the Nigeria Inter-Bank Settlement System Plc (NIBSS), the country’s payment switch, to record POS transactions on its blockchain ledger. The move allows NIBSS to manage the interaction between the cardholder’s bank and the POS terminal on Zone’s regulated blockchain. The partnership was expected to kick off in October 2024, with NIBSS being fully integrated into Zone’s blockchain ecosystem, which would mark the first time a major regulator operated on such a scale within any blockchain framework. However, the integration faced delays due to NIBSS’s institutional structure and the lack of clarity around the stance of the Central Bank of Nigeria (CBN). Despite reaching the agreement with NIBSS in August 2024, the CBN only approved the partnership in December. “NIBSS, being a regulated entity, is very institutional-based. There are strict processes to follow to make sure things go according to the project cycle that [NIBSS] has,” said Emetarom. Zone has added NIBSS to a testnet on its blockchain. The company is still testing its network to ensure data integrity and preparing the live environment for the payment switch to perform its PTSA function. For now, Zone is collecting and storing POS terminal identities on its network. While it isn’t yet fully operational for storing payment records, a handshake with NIBSS allows it to verify these terminal IDs on the blockchain, said Emetarom. The rollout of Zone’s blockchain to POS payments is cautious to maintain the trust of regulators. Emerarom is confident of exporting Zone’s technology across Nigeria’s borders in the coming years, although, according to him, no talks have been established between other foreign financial institutions. The startup also declined to share its revenue numbers, citing a “confidentiality clause” from its investors. For its next act, Zone will take its blockchain payment rail to businesses that provide account-to-account fund transfers, bringing its technology closer to the average Nigerian.
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