Kenya-based Fintech Kwara raises US$4 million in seed round – Fintech Bitcoin News
Kwara is a Kenya-based financial technology company that raised US$4 million in a seed round led by Breega Ventures. The funds will be used to create an application that allows members of credit unions to access financial services.
The growing demand for financial services from credit union members
Kwara, a Kenyan fintech company focused on helping credit cooperatives, raised US$4 million in the latest round of seed financing. The startup plans to use the funds to develop a “neobank” application that allows individuals to sign contracts with their favorite credit unions to obtain various financial services.
The seed round was led by Breega Ventures, with participation from SoftBank Vision Fund Emerge, Finca Ventures, New General Market Partners, Globivest and Do Good Invest. Other investors include Rabacap, Launch Africa, Norrsken Impact Accelerator, Future Africa, Samurai Incubate, DOB Equity and Fintech Angels.
Kwara was established in 2019 and has used its proprietary back-end as a service (BaaS) software for the Association of Kenya Savings and Credit Cooperatives. However, as Techcrunch Report Explain that in just over two years, the number of Fintech customers has increased from only 2 to more than 50, which prompted Kwara to decide to build the application.
Explaining Kwara’s plan after the financing, co-founder and current CEO Cynthia Wandia said:
We hope to make credit unions as efficient as possible by providing members with the new banking experience they wish to have.
The Techcrunch report added that Kwara expects that the application will open up new borderless ways for lending institutions to register new members. The application is also expected to help credit cooperatives get rid of cumbersome paper systems and the need for well-designed physical branches.
The number of members of Kwara’s existing customers has increased by more than 19% year-on-year, which is about three times the global average. At the same time, the loan base of credit cooperatives using its technology has increased by 46%, which is about 5 times the national average.
At the same time, co-founder and chief operating officer David Hwan revealed that the beta version of the application has been tested for feasibility. He said that the usage rate of the application is between 60% and 90%.
The fintech company, which also operates in South Africa and the Philippines, said it hopes to triple the number of credit unions using its software to 150 by the end of 2022. On the other hand, Kwara also plans to increase the number of credit unions by the end of the year, and it will serve 60,000 to 100,000 members.
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