Nigerian FinTech Appzone inks $10m to boost its core banking services

Nigeria-based software provider Appzone, which builds proprietary solutions for the continent’s banking and payments industries, closed a $10m Series A round.

Led by Cardinal Stone Capital Advisers with participation from V8 Capital, Lateral Investment Partners, Constant Capital and Itanna Capital Ventures, the new round will boost investment in Appzone’s core technologies, help in the firm’s expansion as well as develop its financial operating system with the aim to digitise and automate financial services in the region.

Including the latest round, the company has raised $15m in equity funding.

Launched in 2008, Appzone has been building proprietary solutions for the continent’s banking and payments industries. It offers a digital core banking and interbank transaction processing platform with clients across seven African countries including Access Bank, GT Bank and Zenith Bank. Moreover, with the FinTech industry in the continent continually struggling to serve Africa’s unbanked population, the firm aims to capitalise on the opportunities and fill that gap, it said.

Given that Africa’s banking sector is projected to reach a total market valuation of $129bn by 2022 according to McKinsey & Co, it’s easy to see how the sector accounted for over a third of the total $1.3bn in funding secured by African tech startups in 2020.

Commenting on the lack of African FinTech startups tailored for the companies based there, Appzone CEO Obi Emetarom said that traditional and challenger banks in Africa are limited to using foreign technology solutions made for western markets. However, Appzone aims to make the African ecosystem “technologically advanced on the globe through solutions built for Africa by Africans.”

Emetarom added, “For the last 12 years, we’ve worked in stealth mode, building the really complex infrastructure to power the continent’s growing digital financial services space and forging partnerships with the continent’s biggest financial institutions.

“In terms of next steps, we are now looking to hire from Africa’s top 1% to grow our team of elite talent who have proven themselves to be true African builders; the brightest senior software engineers and domain experts, doing the incredibly hard work of building the backbone and next-generation infrastructure for digital financial services at a level beyond world-class.”

To date, the company’s platform has served 18 commercial banks and over 450 microfinance banks, amassing a yearly transaction value and yearly loan disbursement of $2bn and $300m respectively. In 2018, the FinTech received official approval from the Central Bank of Nigeria to operate as a Payment Solution Service Provider.

Cardinal Stone Capital Advisers managing director Yomi Jemibewon said, “Our investment in Appzone is further proof of Africa’s potential as the future hub of world-class technology. Appzone is building a disruptive FinTech ecosystem that will be the backbone of Africa’s finance industry with products across payments, infrastructure and Software as a Service.

“The impact of Appzone’s work is multifold – the company’s products deepen financial inclusion across the continent whilst providing best-fit and low-cost solutions to financial institutions. Its emphasis on premium talent also helps stem brain drain, rewarding Africa’ best brains with best in class employment opportunities.”

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