Nigeria-based Piggybank.ng has raised a $1.1m seed round led by LeadPath Nigeria founder Olumide Soyombo.
Participation to the round also came from pan-African investors Village Capital and Ventures Platform.
Founded in 2016, Piggybank is an automated savings platform that helps millennials in Nigeria to make periodic savings. The platform, available on iPhone and Android, starts by users making small savings from as little as $1, on a daily, weekly or monthly basis, depending on their saving goal. Users can earn an average of 6 per cent per annum on automated savings and 10.95 per cent on fixed deposit savings.
The app helps to save users around $55 a month, and allows withdrawals on a quarterly basis.
Over the past year, the company has received a MoM user transaction growth of between 20 and 35 per cent. The company has around 53,000 registered users, of which around 60 per cent are millennials, and has helped save a total of $5m. Between 2016 and 2017, the company witnessed a savings growth of 3000 per cent.
This capital injection will be used to support its license acquisition and product development efforts. Proceeds will also be used for additional marketing spend to boost its growth trajectory.
Piggybank.ng co-founder and COO Odunayo Eweniyi said, “In a country such as Nigeria, almost everything has to be paid in advance. The majority of Nigerians struggle to save their income, manage cash flow and build credit, which is a huge problem as around 80% of Nigerians need to save a minimum of 40% of their monthly income, in order to survive.
“This is the sheer scale of the challenge we are embracing; to actively promote a savings culture in Nigeria and act as the savings infrastructure to millions of people who want a safe, transparent and innovative platform to assist them in managing their finances, on their journeys to financial freedom.”
The company has gone through accelerator programs with Blackbox, CcHub’s Pitch Drive powered by Google for Entrepreneurs, and Google Launchpad Africa.
Piggybank recently acquired a micro-financing license from the Central Bank of Nigeria. Later in the year, the company will offer its smart target solution, a group savings tool which can be expanded to families or large corporations. This offering is based on the West African tradition of ajo or esusu which leverages communal savings.
Leadpath co-founder Olumide Soyombo said, “Piggybank.ng is a leading example of how Africans are innovating to solve African problems. In this case, the team is applying technology and innovation to solve a problem facing millions of Nigerians; how can they accrue enough money to make down-payments on so many ‘life events’, in a market where there’s little to no access to credit?”
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