In 2011, the Nigerian government launched a financial inclusion program and aimed to include 80% of the country’s adult population. Although only 64% of the target has been achieved by the end of the decade, one positive from this exercise is that achieving financial inclusion across the country is still an ongoing process, with banks as well as fintechs participating in recent years.
Agency banking upstarts are major innovators in this space. Their branchless banking system, with thousands of physical agents, provides financial services to the unbanked and underbanked in rural and semi-urban areas. NowNow Digital Systems, one such platform launched in 2018, raised $13 million in a seed round that will allow the four-year-old startup to scale and expand its service offerings across Africa.
When CEO Sahir Berry and his co-founder Mahesh Nair founded NowNow in 2016, they wanted to provide solutions to two key pain points they felt Nigeria and the rest of the continent were facing, financial inclusion and job creation. According to Berry, in partnership with a foreign third-party partner, NowNow launched a mobile wallet in late 2017 but soon realized it needed to build its technology, setting the stage for a go-to-market the following year. “Doing that and building our proprietary IP has transformed our business,” the chief executive said. “So to begin with, we provided digital banking solutions to consumers and businesses. But today, we are fast becoming an embedded finance platform.
NowNow claims to have built an end-to-end ecosystem of financial products for agents, individual consumers and small businesses. Its flagship product, similar to other agency banking platforms such as OPay, TeamApt and Nomba, has 50,000 agents across the country who provide financial services such as sending and receiving money and paying bills. Fintech has a consumer product where people can send and receive money, pay bills, and access value-added services like insurance and lending through a debit card and in-app wallet. The service is available to users with smartphones and feature phones; However, for the latter, they have to visit agents to access other services, Berry said. Similar digital banking providers in this segment include Kuda, Carbon and Fairmoney.
According to Berry, NowNow wants to set itself apart from the competition with the development of NFC-enabled tech that enables tap-in functionality across an ecosystem of products where consumers use virtual or physical cards against an NFC-enabled phone or POS, and tap from wallet to wallet using both phones. The product has been made available to some small businesses to test in a pilot phase. NowNow, on the other hand, generally provides these SMEs with a business-in-a-box platform with tools and value-added services such as storefront and marketplace.
“It is an end-to-end integrated platform for SMEs including logistics and we are the first company in Nigeria to offer such an end-to-end platform,” Berry said. Beyond that, since we have built all this technology and own the IP for it, we have also become a BaaS company offering our product to multiple fintechs in Nigeria and Africa. We also have reputed financial institutions using our products to provide a white-label solution to their customers. Thus reducing the risk of us playing in the consumer and B2B space.
NowNow is targeting 5,000 SMEs with its business-in-a-box solution, including NFC-enabled tech, by the end of the year. On the consumer side, the fintech claims to serve over 200,000 customers; It hopes to increase that number to 1 million by December. “We are tracking approximately $5 billion in transaction GMV by the end of this year across all platforms,” Berry added.
With the newly secured funding, NowNow plans to grow its platform, team and marketing to a level where the company is “ready to adopt now.” The fintech, which was recently selected to participate in MasterCard’s Start Path global program for seed, series A and later stage startups, also wants to introduce new products to enhance its existing consumer banking, agency banking and merchant payment solutions and expand into African countries. Fintechs from Nigeria rarely move to: Angola and Liberia.
“We want to work in countries where we find that infrastructure is frozen and fintech can step in and see what solutions can be provided to address the situation. Angola is one of the places where we have identified that the digital payment space is lagging behind and we may start there next month. Another country where we are gearing up to set up operations is Liberia.
Lead investors in the seed round welcomed participation from several firms including Dubai-based venture capital firm and studio Neovision Ventures, India-based DLF Family Office and Shadi Abdulhadi.