Two African fintech firms operating in Nigeria get $3.2 million grant

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Again, two financial technology companies in Africa, MFS Africa, and Frontclear, have secured $3.2 million worth of investments from FSD Africa Investments. This latest round of funds means FSD Africa Investments has invested $12.9 million in the duo fintechs.

In 2018, FSD Africa Investments financed USD$2.2 million in MFS Africa Series B capital raise to support the expansion of its services and network. In 2015, FSD Africa made an investment into Frontclear valued at USD$7.5 million to improving interbank liquidity and strengthening financial markets on the continent.

Speaking on the new capital infusion, the Chief Investment Officer for FSD Africa Investments, Anne-Marie Chidzero, said, “MFS Africa and Frontclear are two firms that with the right support could have a transformative impact on Africa’s financial markets. MFS Africa has the potential to allow anyone on the continent with a mobile money account to send money aboard or buy something on Amazon.

“While Frontclear is helping banks across the continent access liquidity and knowledge and support to address barriers within the continent’s money market. By investing in these companies, we are giving them much-needed capital to drive change.”

The Founder and Chief Executive Officer of MFS Africa, Dare Okoudjou, said, “MFS Africa’s vision, is to enable every African mobile user to transact freely with anyone, anywhere in the world focusing on creating new digital pathways. This can only happen through investments and partnerships.

“Therefore, this investment will help MFS Africa’s capabilities to build a stronger payments service that will help strengthen Africa’s financial markets, whilst providing support for emerging SMEs across the continent.”

Meanwhile, Hugh Friel, Vice President, Frontclear, said, “This investment will enable the Frontclear fund to have a more profitable and efficient capital structure allowing it to increase the number and volumes of inter-bank transactions that will contribute to the economic growth and financial stability of financial markets in Africa.”

About MFS Africa: It is a fintech company that connects over 180 million through a payment system in Africa. MFS Africa operates in partnership with banks, mobile operators and money transfer companies to transact across several platforms. Last year, MFS Africa became the first non-bank to receive a pan-African issuing license from Visa. The partnerships will simplify remittances and expand access to global e-commerce across more than countries in sub-Saharan Africa; a significant development to improve payment services on the continent.

About Frontclear: This is a financial market development company. Frontclear fosters more inclusive markets by supporting interbank lending between domestic banks. As of January 2020, Frontclear had mobilised $1 billion in interbank credit through the issuance of $590 million in guarantees. While active in emerging markets and developing countries around the world, 61% of Frontclear’s portfolio is in Africa, in countries including Ghana, Kenya, Nigeria, Tanzania, Zambia, and Egypt.

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