Nigeria’s Challenger Bank Kuda Raises $10M For Its Mobile-First Services

Nigeria-based Kuda, which operates its own mobile-first challenger bank, now has $10 million after a funding round in what TechCrunch reported is the biggest seed round ever raised in Africa.

The round was led by European venture capital firm Target Global, while Entrée Capital and SBI Investment participated as well, alongside numerous other investors, according to the report. Kuda’s bank works with customers and will soon add a capability for small businesses.

CEO Babs Ogundeyi said the company’s goal is to “bank every African on the planet, wherever you are in the world,” TechCrunch reported.

Kuda launched in 2019 and has since racked up almost 300,000 customers, including some small businesses as of late, the report stated. The company processes around $500 million in transactions per month.

Prior to this round, Kuda had also raised $1.6 million in a pre-seed round, and Ogundeyi said he’s already working on a larger Series A for the future, according to the report.

Kuda, according to a previous PYMNTS report, was granted a license from the Nigerian Central Bank, making it the first digital-only bank with a standalone license. Ogundeyi previously held a role working with the Nigerian government in financial advising. The bank worked to add savings and P2P payments after its launch, offering quick bank account openings.

African FinTechs have been in the spotlight as of late, with Kuda taking advantage of a particular hotbed in Nigeria, TechCrunch reported. Unlike other challenger banks, Kuda hasn’t focused on partnering with other financial institutions, instead focusing on customer service and boosting user-friendly experiences and money management services, managing payments, issuing cards and allowing physical deposits.

The pandemic has affected the Nigerian banking landscape, PYMNTS reported. While cash had long been the preferred method there, the pandemic forced many businesses to close their doors, spurring people to seek more digital options.