Chinese-backed and Africa-focused fintech company OPay raised $400 million in new financing led by SoftBank Vision Fund 2. The round, which marks the fund’s first investment in an African startup, drew participation from existing investors like Sequoia Capital China, Redpoint China, Source Code Capital and Softbank Ventures Asia. Other investors, including DragonBall Capital and 3W Capital, also took part in the new financing round. This news comes three months after The Information reported that the company was in talks to raise “up to $400 million at a $1.5 billion valuation” from a group of Chinese investors. While the company started with providing customers with digital services in their everyday life, from mobility and logistics to e-commerce and fintech at cheap rates, those super app plans have been largely underwhelming. Right now, it’s the company’s mobile money and payment arm that thrives the most. By simply allowing 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.
Nigeria is Africa’s most populous nation, and with a large share of its people underbanked and unbanked, fintech is the most promising digital sector in the country. The same can be said for the continent. Mobile money services have long catered to the needs of the underbanked. Per GSMA, Africa had more than 160 million active mobile money users generating over $495 billion in transaction value last year. Parent company Opera reported that OPay’s monthly transactions grew 4.5x to over $2 billion in December last year. OPay also claims to process about 80% of bank transfers among mobile money operators in Nigeria and 20% of the country’s nonmerchant point of sales transactions. Last year, the company also said it acquired an international money transfer license with a WorldRemit partnership also in the works.