- Paga to Accelerate Growth With $10m Investment
Paga, a mobile money company in Nigeria, has announced that it has closed a $10m growth financing led by the Global Innovation Fund.
Also participating in the round are existing investors, Goodwell (managed by Alitheia Capital), Adlevo Capital, Omidyar Network and Unreasonable Capital.
According to the company, this new financing brings the total that Paga has raised since inception in 2009 to $35m.
It commenced commercial operations in August 2012 and recently revealed that since then, it had served nine million customers and created over 10,000 jobs through its 17,000 agents who hire workers to run their stores.
The Chief Executive Officer, Global Innovation Fund, Alix Zwane, said, “The GIF is proud to lead Paga’s Series B2 round.
“Paga’s mission of helping people ‘make life possible’ aligns with our core mission of supporting entrepreneurs and innovators that seek to improve the lives of those living on less than $5 per day. I am pleased that the GIF will help to enable Paga’s next phase.”
Nigeria is one of the fastest growing emerging markets in the world and the biggest economy in Africa, with $405bn Gross Domestic Product. The country currently has a population of 186 million but is expected to become the third largest country in the world (behind India and China) by 2050 with 411 million people.
Financial inclusion experts say that in Nigeria today, over 100 million adults find it difficult to transfer or leverage money for basic human needs. According to them, this problem is one that exists even for those that are banked, and is something Paga’s team is passionate about solving.
The Managing Partner, Alitheia Capital, Tokunboh Ishmael, said, “The growth financing announced today will enable Paga to further scale its business in Nigeria to drive the growth of Paga’s mobile wallet and agent network, and explore expansion opportunities in other markets where similar problems exist.
“Our belief in Paga as an effective platform to drive financial inclusion is unwavering. Paga has shown solid progress, and alongside other investments in our portfolio, has played a huge role in our ability to demonstrate that enabling access to essential services for the broad population has both significant financial and developmental impact.”
According to Chief Executive Officer, Paga, Tayo Oviosu, the company’s transformative purpose is to make it simple for one billion people to access and use money.
Oviosu stated, “With a nationwide network of 17,000 agents and more than nine million users accessing funds in Nigeria, Paga is making strides by enabling efficient digital payments and building successful societies. This has translated to over 57 million transactions processed worth approximately $3.6m, a business that is profitable and growing at 110 per cent compounded annual growth rate (2016-2018).
“At Paga, we are building an ecosystem that enables people to digitally send and receive money, and creating simple financial access for everyone.”
He added, “We do not seek to be a bank, but rather to partner the banks and financial institutions in the markets we operate. We are proud to welcome the Global Innovation Fund as a partner on our journey.
“We were attracted to them because of their global focus, network to help us achieve our ambition and a clear alignment of values. It is also fantastic that our existing investors remain committed to our strategy and are demonstrating that by their additional investments.”
Oviosu had earlier said that the firm’s mission was strengthened by the recent release of its new money transfer app that would drive the use of the Paga wallet for person-to-person transfers and in-store payments.
“In a country where digital financial services still leave much to be desired, Paga is staking a claim at being the Venmo of Nigeria. With cash still being king in emerging markets and the general unreliability of Point of Sale services, coupled with the sparsely located banks and Automated Teller Machines, the company has created a viable solution for ease of payments: a simple app that allows you to send money to or request money from anyone only using their phone number or email address, and a digital wallet to which you can link any debit card or bank account,” he noted.