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Startups

China investors back Africa-focused fintech startup

SoftBank Ventures, Sequoia also throw weight behind Lagos-based payments company

Women vendors display Nokia phone models for sale along with smartphones at the 'Computer Village' in Ikeja district in Nigeria's commercial capital Lagos, Nigeria May 31, 2017. REUTERS/Akintunde Akinleye   © Reuters

HONG KONG -- Africa-focused fintech startup OPay has secured $120 million in a Series B financing round mainly from Chinese investors.

Meituan-Dianping and its investment fund DragonBall Capital, Gaorong Capital, Source Code Capital, SoftBank Ventures Asia, Bertelsmann Asia Investments, Redpoint China, IDG Capital, Sequoia Capital China and GSR Ventures all took part in Series B, according to a statement released late on Monday.

Chinese interest in the African fintech sector has been growing in recent years. OPay raised $50 million in June in a round led by Chinese investors. This most recent fundraising follows a $40 million investment by Lagos-based payments startup PalmPay, led by China's Transsion.

OPay, located in Lagos, was incubated in 2018 by Opera, a Norway-based and Chinese-controlled online consumer icompany. OPay provides consumers with a wide range of services including mobile payments and transfers, ride-sharing and food delivery.

The company plans to use the new capital to further accelerate its expansion across multiple verticals, as well as to launch operations in new African markets.

"OPay will facilitate the people in Nigeria, Ghana, South Africa, Kenya and other African countries with the best fintech ecosystem that Africa has ever seen, paired with the inclusion of daily-use services such as transportation and delivery," OPay CEO Zhou Yahui was quoted as saying in the statement.

"The capital raised will be allocated to African countries where local regulation is supportive of scientific and technological entrepreneurship in the fintech space," said Zhou.

With its strong presence in Nigeria, OPay launched its mobile payment service in August 2018 to create an infrastructure onto which the company is now adding new services. The agent-centric mobile payment operation focused on reaching the massive unbanked population of Nigeria.

Since its Series A funding round, OPay claims to have tripled its active agents to over 140,000 with the daily transaction volumes doubling to exceed $10 million per day.

Additionally, OPay's motorbike ridesharing service has more than tripled its daily rides over the past three months, and the company recently launched additional services around food delivery and cashless payments for offline businesses.

"The additional capital will allow OPay to speed up its expansion in mobile payment services and its growth in new verticals. Further, the strength of Opera's brand and OPay's emerging position will continue to benefit both companies and further escalate their ability to take leadership in several internet verticals across Africa," said Zhou.

Opera, which has over 350 million average monthly active users, operates as a global internet brand providing products and services to users in Europe, Africa and Asia. The company offers PC and mobile-based internet browsers, as well as artificial intelligence-enabled news reader Opera News and app-based microfinance solutions. The company is listed on Nasdaq under the symbol "OPRA."

DealStreetAsia is a financial news site based in Singapore focused on corporate investment activity in Southeast Asia and India. Nikkei recently acquired a majority stake in the company.

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