ZirooPay, a mobile POS company based in Lagos, has received $11.4 Million in a Series A round, led by Zrosk Investment Management (a Lagos-based venture capitalist firm). Nordic Inventure was among the original investors. Exotix Advisory and Fedha Capital were also present.
Individual investors included Petri Kivinen, a previous managing director at Deutsche Bank, Morgan Stanley, and Renaissance Capital; Abiodun Ajai, a director at Bank of America’s Sub-Saharan Africa division; and Jonas Dromberg, a former Bloomberg bureau chief.
According to the startup the new funds will help it to improve its payment infrastructure, expand and grow its staff.
IroFit, ZirooPay’s parent organization, pitched its “Internet-free” technology as a mobile platform for small companies to receive card payments via a mobile app and EMV-certified card reader in locations where there is no data access, especially in emerging economies.
Omoniyi Olawale (CEO), was based in Helsinki at that time and stated that the cash-secured ($600,000.00 in seed) would be used for the start of the company in Nigeria. However, the company didn’t launch in Lagos until five decades later.
Olawale further explained that the wait happened because his organization was fine-tuning its technology and expanding its possibilities after raising an additional €2 million.
That pitch hasn’t altered, and ZirooPay has increased tremendously in its three years of existence. Over 15,000 merchants use the firm’s POS machines and mobile app, according to the organization. According to the business, these merchants have processed $500 million in transactions over three years. This represents a 5,000% increase in transaction volume after 10 million transactions.
ZirooPay plans to use its expansion investment to expand its product line and include other payment channels. ZirooPay is excited about the opportunity to lead an open retail space as POS suppliers in Nigeria, particularly fintech, have increasingly focused on agency banking. This area fosters financial inclusion and is a major focus of fintech companies in Nigeria.
The COVID-19 lockdown showed us that not all types of work can only be done remotely.
The most common examples include buying and selling as well as financial services. Due to the lockdown, young Nigerians were also exposed at a local level to financial services.
Statista reports that the number of POS points in Nigeria has increased significantly from 150,000 in 2017 up to 543,000 by April 2021. The country’s POS payments has increased significantly over the years to reach more than 500 million in May 2021.
Nigerians use POS machines to pay their cards at shops and for agency banking. Agency banking is a type of banking that does not require a bank branch. Instead, agents act as human ATMs.
Terminals can be connected to a wide range of financial institutions and functions, but they are all largely online-based. Only a few terminals offer offline functionality.
This isn’t to imply that branchless banking is without its drawbacks, one of which is the high rate of transaction failures caused by a poor internet connection. However, companies are constantly innovating new ways to make banking more convenient.
Olawale said that this resulted in ZirooPay’s development of its own technology. The firm now holds a patent which allows it to process such events instantly without the need for an internet connection.
For merchants and payment processors, every interaction with a retailer is a data mine. It’s difficult for POS terminals to automate their bookkeeping processes because they lack the necessary bookkeeping capabilities.
However, ZirooPay’s mobile app enables small businesses in the retail, agency banking, hospitality, and services industries to undertake similar duties like monitoring sales and managing operations.
Although it’s interesting that the once cash-oriented Nigerian population is now embracing cashless payments as a mode of transaction, it’s also important to mention that it’s assisting to tackle Nigeria’s unemployment crisis while also promoting financial inclusion.