Tanzanian fintech ‘NALA’ raises $10M

NALA is a Tanzanian cross-border payments company that has recently shifted from local to international money transfers. This seed round comes almost three years after NALA received a pre-seed round of seven figures led by . in 2019. NALA developed a mobile money service for East Africa in that period and grew it to over 250,000 users. NALA began testing international money transfers in 2021 after users expressed an interest in moving money between the U.K and East African countries (Kenya Uganda Tanzania) thus introducing the Tanzanian fintech to the remittance industry.

Remittances are a lucrative business opportunity, even though digital lenders compete for less than 20% in the international money market that is dominated by offline players. Digital senders such as NALA are positioned to offer customers the lowest rates and the best prices, with Africa being the most costly region to send money. Sendwave, Lemonade Finance and unicorn Chipper Cash are other players that facilitate transfer from the U.K. to selected African countries. They all believe that their market will continue to grow and take over traditional incumbents’ shares. It remains to be seen if that will happen. NALA’s growth has been impressive since the launch of the product last year. The platform accepts payments from the U.K. to Tanzania and Kenya, Uganda, Rwanda, Rwanda, Ghana, and Uganda. The company stated that more than 8,000 customers have transferred over eight figures to Africa in the last six months.

“Our core customer base right now is the diaspora who live in the U.K. In an interview, CEO Benjamin Fernandes stated that this is the customer that we are currently serving. “We also received our license approvals to go online in the U.S.A. and the E.U. We will also be going live in at least one additional E.U. in the next month and a quarter. France, most likely.”

NALA’s lowest-hanging fruit is Remittance. Fernandes says that NALA has more offerings than Revolut did when it launched in the U.K. This European fintech unicorn is now a financial super app of some sort. It started out offering multi-currency bank accounts, currency exchange without fees, peer-to-peer payments, and a feature that could be used by businesses. NALA also allows cross-border payments from the U.K., the U.S., and the E.U. Private beta testing is currently underway for multi-currency accounts to allow African diaspora members to store their local currencies abroad. NALA for Businesses is being piloted by the company. This allows diaspora business owners to make payments to Africa. Fernandes, a Tanzanian fintech, says that it will build infrastructure to allow money transfers between Africa and the U.S.A. and the U.K.

We’re expanding that, not only in Tanzania, Kenya, and Uganda. In the long-term, however, we plan to create infrastructure on the continent that allows us to outbound and allows people to send their money back. The founder said that we have submitted our application for a remittance license in Kenya and Uganda to enable us to do this the opposite way.

The company has appointed Subuola, an ex-Citi U.K. MLRO, and former chief compliance officer at pan African bank Guaranty Trust Bank to head its compliance efforts. The company also signed a deal to manage their F.X. It is one of few African tech companies to have this deal. Fernandes said that NALA will launch a crowdfunding campaign to help users acquire and retain their trust. The first users will have the opportunity to purchase shares in the company as part of its user retention and acquisition efforts. Similar companies that facilitate money transfer in Africa such as Eversend have made similar moves in recent years. Nicolas Esteves, CTO and Nicolai Eddies, COO are part of NALA’s executive group. They have previous experience at Monzo Osper, Morningstar, and Monzo.

The new round also includes Amplo, Accel, and Bessemer Partners as lead investors, along with local investors such as DFS Lab.

NALA received funding from an impressive group of angel investors, including Jonas Templestein (co-founder and CTO at Monzo); Vladimir Tenev, Robinhood founder and CEO; Alex Bouaziz, cofounder of Deel; Laura Spiekerman (co-founder of Alloy); and Peeyush Ranjan who is the head of Google Payments. He also worked with early employees at Revolut, TransferWise.

Sheel Tile, founder and general partner of Amplo will join NALA’s board, the company stated in a statement.

NALA will be able to increase its workforce, foster growth in Europe, the U.K. and America, and build payment rails in Africa.

“We don’t want to be like a regular remittance business, and people will naturally do that. Fernandes said that remittance is only a starting point for the future. My view is that only 1% of payments in Africa is currently being made and that there is much infrastructure and software to be developed. This is where we want to be, and the $10 million round will do a lot to help us get there.

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