Lemonade, a fintech startup in Nigeria that helps Africans send and receive money from and to their home countries, is not unique. However, the startup believes it has a special sauce that makes it stand out.
Ridwan Olalere, Rian Cochran, and a participant of Y Combinator’s W21 batch last years, Lemonade Financing allows Africans to send and receive money in an efficient, affordable, and quick way from home. The app allows users to keep their balances in the currencies they value and convert them easily.
The company provides instant international and local transfers to Ghana, Kenya and Nigeria. It also makes international transfers at the market rate. There are many companies that offer the same service, so how is a Nigerian company, which is still in its early stages, different?
“Cross-border payments to Africans have three major problems: long transaction completion times and restrictions on use. They also charge steep fees. These issues make it difficult for Africans to use platforms for international transactions, particularly peer-to-peer.
“WorldRemit and TransferWise, for example, allow Nigerians to send money but not receive it. PayPal works in the reverse, allowing Nigerians to send money but preventing them from receiving it. The wait time for international funds transfer can take up to four days. This is similar to Western Union. This delay is often compounded by the fact that Africans are often required to pay more than the global average.
Lemonade claims that Lemonade is faster, more affordable, and allows users to change currencies. Lemonade claims it has thousands of users in North America and Europe. In the wake of its participation in Y Combinator, raised a pre-seed round of US$725,000 that included the likes of Ventures Platform and Acuity Venture Partners.
Lemonade intends to expand to Ghana in the coming year and has a variety of new product offerings, including payments for bills and most importantly, its Cards feature.
Olalere stated that “users will be able create virtual Naira or Dollar cards to complete transactions online on local and international sites.”
Lemonade is not the only company that has this technology. However, it offers the additional benefit of creating unlimited cards and offering rewards through its cashback program.
Olalere stated that customers will be able use their cards to pay global services such as Apple Music, Spotify, Amazon and GooglePay.