Kenyan fintech startup offering a secure, simple and affordable digital banking platform for Savings and Credit Co-operative Societies (SACCOs) and their members, Kwara, has raised a $3 million seed round.
The new funding was led by existing investors such as DOB Equity, Globivest and the founder of Kobalt music. There was also funding from new investors who were mainly African VCs such as One Day Yes and Base Capital, as well as fintech leaders including Mikko Salovaara, CFO of Revolut.
Recall that on January 12, the startup announced the acquisition of IRNET Coop Kenya, a software company that is a subsidiary of the Kenya Union of Savings and Credit Cooperatives (KUSCCO LTD).
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With the acquisition, Kwara has now entered into an exclusive digital solutions partnership agreement with KUSSCO, which will see the start-up offer its banking software solutions and mobile banking channels to boost the growth and profitability of SACCOs in Kenya.
Kwara CEO and co-founder Cynthia Wandia recently revealed that the deal came at the right time.
In her words,
“We believe we have barely scratched the surface of the Kenyan market. And so, we’re just going to really invest in products and services that deepen our relationship here.
“The rationale (of the deal) is clear, firstly, it is an opportunity to generate leads and distribute our core product so quickly, and to deepen our competitive moat.
“We are entering into an exclusive partnership, which also means that no other technology company will be able to market with Kuscco. They are betting on us, but we have been able to prove that we can do what we continue to grow.”
The Group Managing Director of Kuscco also said of the collaboration with Kwara, “this development marks a game changer in the management of credit unions going forward. The acquisition of IRNET and the KUSCCO-Kwara partnership will deliver to our 4,000+ member credit unions tested and proven, secure and efficient digital services as well as a modern new banking experience“.
This will see the entire IRNET team join forces with Kwara to ensure a seamless transition and to embed Kuscco’s entire regional network of 16 branch offices and several hundred marketers and marketing expertise in Kwara.
Founded in 2018, Kwara offers secure, simple and affordable online and mobile banking for partner financial institutions and their members who are often excluded by traditional banks.
The fintech startup is on a mission to make building wealth together frictionless and ensure financial institutions can meet members’ financial needs immediately, helping them avoid expensive predatory options.
Backed by the Catalyst fund, Finparx, Google for startups, Kepple and Bonum ventures, Kwara currently serves over 27,000 members.
