FinTech firm Afriex secured a $1.2m in a seed funding round with an aim to scale its payments and remittances platform across Africa.
The round was led by African venture capital firm Launch Africa, with other investors including Y Combinator, SoftBank Opportunity Fund, Future Africa, Brightstone VC, Processus Capital, Uncommon Ventures, A $ AP Capital, Precursor Ventures and Ivernet Holdings. Angel investors Russell Smith, Mandela Schumacher-Hodge Dixon, Furqan Rydhan and Andrea Vaccari also participated in the investment.
With the new injection, the startup plans to grow its team and expanding into other markets as well as boost its vision to become the fastest, cheapest way to send money to anyone in the world.
Founded by Tope Alabi and John Obirije in 2019, Afriex provides instant and free transfers to Africans allowing users to deposit and send money as well as withdraw to a connected bank or debit card.
Afriex has built its business on stablecoins where it buys cryptocurrency in one country and sells it in another to provide better exchange rates as opposed to those like Western Union and Wise who run on a more traditional banking system.
Having graduated from YC last year, it claimed it processed around $500,000 per month in transaction fees across more than 30 countries.
While it was only present in Nigeria and the US at the time, it has since started operations in Ghana, Kenya and Uganda.
Commenting on the firm’s growth, Alabi said the idea of the firm was based on his personal experience when he was forced to pay exorbitant rates to transfer money. “I would find myself having to pay for foreign expenses with money that was sitting in a US bank account. Traditional remittance companies were so slow and expensive that I knew I could do it better with crypto.
“Remittance is the best and most important use case for crypto. Our goal is to build the world’s largest remittance company starting with emerging markets. We don’t have to hold inflationary currencies – we can just hold USD and crypto allows us to source better exchange rates,” Alabi said.
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