Wapi Pay, a Singapore-based Kenyan fintech startup powering the Africa-Asia cross border payment, has raised $2.2m in a pre-seed round to scale its product.
Participated in the round are a couple of ventures across the two continents. In Asia, there is MSA Capital, a China-based fund known to have invested in unicorns like Meituan, Klana and Nubank, the biggest digital bank in the world; Transsion Holding and Gobi Ventures. Then there are EchoVC, Kepple Africa and Future Hub that joined the round from Africa.
Trade relations between Africa and Asia, especially China and India, have seen exponential growth over the years, mostly because African leaders are either looking for a way to detach from the supremacy of the West or easy less-regulated trading options.
Africa-China trade rose by 27% to $52.1 billion in the first quarter of 2021 compared with last year, due to the economic recovery from after the pandemic. In 2013, an article published by the United Nation called China “the heart of Africa,” and it has since then become the second-largest African trade partner only after the whole of the EU.
Despite the growth in trade numbers, traders still have to deal with high remittance fees of up to 20% of the transacting amount, a ridiculous waiting period of up to five days and are exposed to the risk of consistent transaction reversals with a non-refundable transaction fee.
Wapi Pay is building a hand-on solution to solve these headaches. Wapi claims it can process payments within a day and charges as low as 3%, eradicating both high remittance fees and shrinking the waiting time to that of a city-to-city frame.
Wapi Pay’s founding story
Wapi Pay was founded in 2019 by Paul Ndichu and his brother, Eddie. Both founders have about 20 years of collective experience working and leading in the African digital banking economy.
“We started Wapi Pay having seen how fragmented the payment infrastructure is and how horrifying the experience and expense of making or receiving a payment to and from Asia,” said Paul Ndichu.
“We spent some time in Asia, given the growing trade relationship between the two corridors [Africa and Asia], and saw the growing need to make this more efficient, faster and cheaper, evolving from remittances to global payments. These transactions are already complex in nature; how do we make them as simple and easy as mobile money?” he added.
“Wapi Pay bypasses traditional payment networks, optimizing efficiency and cost for our customers. Users choose the delivery channels they want, such as a bank to bank, wallet to wallet, bank to wallet and wallet to bank options to transfer funds as well as make merchant payments, with settlement done within 24 hours,” said CEO Eddie in a statement.
Wapi Pay is currently headquartered in Singapore, one of the cities powering the Asian economy, and has offices in Kenya and China; the startup also works with local banks and platforms in China, Indonesia, India, Japan, Malaysia, Philippines, Singapore, Taiwan, Thailand and Vietnam.
The company claims to be growing at 396% year-on-year since 2019 and hopes to continue on this trend. By the end of next year, it wants to process $500 million in remittances and increase the number of African merchants and Asian suppliers to half a million and 100,000, respectively.
“These funds will help Wapi Pay diversify our product range and drive growth so that we can evolve remittances into real-time global cross-border payments, starting with Africa and Asia. All while minimising the cost of transactions, it needs to be as easy as sending M-PESA,” Eddie added.
Part of the non-equity pre-seed fund will be used to engage regulators for licensing and expansion across Africa and the rest will be used to scale up global payments and remittances between Africa and Asia.
“Africa to Asia is a large trading corridor overlooked and underserved by tech today. We believe Wapi Pay is the best team to build the necessary infrastructure to support its growing trade volumes. We are excited to support them with our extensive China fintech network and playbook,” said Tim Chen, vice president at MSA Capital.
The post Kenya’s Wapi Pay raises $2.2m non-equity pre-seed led by Nubank investors appeared first on TechCabal.
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