African Fintechs Gain Financial Backing From World Bank

African Fintechs Gain Financial Backing From World Bank
Ten Fintechs awarded $5000 by World Bank

Through the Southern Africa Innovation Bridge Portal initiative, the World Bank has provided financial support to ten fintech start-ups. This initiative has created an opportunity for underserved communities, which are often seen as high-risk by investors, to access funding.

Supported by the World Bank and Switzerland’s State Secretariat of Economic Affairs, this initiative provides fintech start-ups with a platform to demonstrate their products. The programme aims to introduce innovative and influential technologies to the market and promote financial inclusion in southern Africa.

Marino Cuenat, deputy head of Mission for the Embassy of Switzerland, said, “South Africa’s financial services sector is well regarded, and we are thrilled to be actively promoting fintech in partnership with the World Bank. There are many untapped opportunities to be explored.”

During the fintech challenge, the following companies received recognition for their solutions: Abela, Bento Technologies, Fintr, Moya Money, Sum1 Investments, Thumeza, Chaperone, FundRoof, Ipachi Capital, and Prime Capital. Each of these start-ups was granted $5,000 to prepare their businesses for investment.

As per the World Bank, the primary goal of the fintech challenge is to facilitate market access, business networking, and investment opportunities for underserved entrepreneurs. The training provided to the start-ups has improved their ability to effectively engage with investors, thereby increasing their likelihood of successful capital raising.

Additionally, all the entrepreneurs in the programme have demonstrated notable progress with their businesses and are now prepared to expand and collaborate with pre-seed and seed investors.

Marie Francoise Marie-Nelly, World Bank country director for southern Africa, said: “The region's most innovative and impactful fintech companies unveiled their solutions to enable greater financial access to the poor, after an eight-week investment readiness programme, which included masterclasses and mentoring. Of the 15 participating start-ups, 10 were awarded financing. These businesses are investment ready and are now eager to engage further with interested investors.”

Awelani Ruhalani, deputy chair of the Intergovernmental Fintech Working Group (IFWG), said: “To date, over 170 fintechs have had regulatory guidance from the IFWG. There has been such high interest in the sandbox process that we have changed the approach from testing specific cohorts to a rolling approach. In other words, applications for the sandbox are always open.”

What is the Innovation Bridge Portal?

The Innovation Bridge Portal Entrepreneur Community is an initiative of South Africa’s Department of Science and Innovation and the Council for Scientific and Industrial Research, in partnership with the Department of Small Business Development.

The goal is to create a digital platform that fosters innovation, collaboration, co-creation, knowledge exchange, and networking among various stakeholders within the ecosystems of South Africa, Botswana, Namibia, Eswatini, and Lesotho.

The programme’s objective is to offer affordable and suitable savings and de-risking products for the low- and middle-income markets, as well as lending solutions tailored to small and medium-sized enterprises (SMEs).