NAIROBI, Kenya–A fintech that has been digitizing credit unions in this country, known as saccos, and which was highlighted during a presentation at 2022’s World Credit Union Conference in Scotland, has raised $3 million in new capital.
The company, Kwara, featured here in CUToday.info, more than doubled its client base last year, and its eyeing enormous growth in the coming years after raising the new funds and signing an exclusive digital solutions distribution agreement with the Kenya Union of Savings & Credit Cooperatives (Kuscco), according to Tech Crunch.
Following the Kuscco partnership, Kwara said it has gained connections to a pool of over 4,000 saccos for its banking-as-a-service offering, the publication stated. As part of the exclusive deal, Kwara is also set to acquire Kuscco’s subsidiary IRNET, a software company and provider for saccos, for an undisclosed amount, TechCrunch added.
Kwara says the Kuscco deal comes at the right time in its plan to double down on Kenya.
‘Barely Scratched the Surface’
“We think we’ve barely scratched the surface in the Kenyan market. And so, we are just going to be really investing in products and services that deepen our relationship here,” Kwara co-founder and CEO, Cynthia Wandia told TechCrunch.
“The rationale (of the deal) is clear, first it is an opportunity to generate leads and distribute our core product as fast, and to deepen our competitive moat. We’re entering an exclusive partnership, which also means no other tech company will be able to market with Kuscco. They are stacking their bets on us but we have been able to prove that we can do it as we continue to grow.”
Wandia co-founded the fintech with David Hwan (COO) in 2019.
According to Tech Crunch, Kwara, which also has a presence in South Africa and the Philippines, has grown its clientele base to 120 from 50 at the end of 2021. The automated onboarding process, the startup stated, has ensured member success and growth.
‘Upgrades Back Office’
“Kwara’s product upgrades the back-office operations of credit unions helping them to shift away from tedious paper-based processes and physical branches, opening up new avenues for them to sign up new members and create novel products,” TechCrunch reported. “The company also has a next-generation neobank app that gives members of partner credit unions access to additional services such as instant loans and third-party services such as insurance. It said the user base of the neobank app, which also allows users to deposit money directly into their sacco accounts, and track their finances and payments, has grown 35-fold since launch last year.”
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