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Nigeria’s Digital Banking Startup Raises $1.6m Pre-seed Funding

Nigerian fintech startup Kuda, which is building a digital-only banking platform, has raised US$1.6 million in pre-seed funding as it marks its beta launch.

Launched in 2016 as lending platform Kudimoney and a participant in last year’s Startupbootcamp AfriTech accelerator programme, Kuda rebranded in June and received a banking licence from the Central Bank of Nigeria (CBN) in preparation for the launch of a full service digital bank.

What makes Kuda different from other Fintech Startups, in his world, Babs Ogundeyi said “Kuda is the first digital-only bank in Nigeria with a standalone license. We’re not a mobile wallet or simply a mobile app piggybacking on an existing bank, We have built our own full-stack banking software from scratch. We can also take deposits and connect directly to the switch,” Ogundeyi added, referring to Nigeria’s Central Switch ”

That regulatory approval made Kuda Nigeria’s first and only full-stack and mobile-first bank, with the startup recently opening its beta to the public in preparation for a full launch in the fourth quarter of the year. This process has been assisted by the closing of US$1.6 million in pre-seed funding, with participation from Startupbootcamp, as well as angel investors Haresh Aswani – of the Tolaram Group – and Ragnar Meitern, an early investor in Monese and Bolt, among others.

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“Kuda’s vision of democratising financial services and making it easily accessible and affordable for all Africans aligns with my philosophy on transforming industries and value creation. The founders of Kuda are extremely smart and knowledgeable about the space. I am excited to partner with Kuda and support their continued growth,” said Aswani.

The Kuda beta launch includes a range of features, including a free banking platform and debit card, iOS and Android app that track spending in real-time, and the lowest transfer rates in Nigeria with the option to pay bills and buy airtime. Over the coming months, Kuda will expand its product offering to incorporate consumer savings and rewards, as well as peer-to-peer payments.

“Kuda is the future of banking in Africa. Our mobile-first bank is built to address the serious pain points for the world’s most mobile centric consumers. We are building a radically different type of bank that puts consumers back in control of their finances. With Kuda, our users get an intuitive mobile-first experience that is almost instant to set up, a world-class app and services that work seamlessly to make their lives easier,” said Babs Ogundeyi, the startup’s co-founder and chief executive officer (CEO).

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