Breaking News
0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Nigerian Payments App Paga May Be Africa’s Next Unicorn

ForexJun 11, 2021 11:11
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.

(Bloomberg) --

Nigeria’s biggest mobile payments company is vying to become Africa’s next unicorn, and its ambitions now stretch beyond the continent.

Paga, whose backers include U.S. billionaire investor Tim Draper and former Goldman Sachs Group Inc (NYSE:GS). economist Jim O’Neill, boasts 17 million unique users including tech entrepreneurs, businesses and individuals in Africa’s most populous nation.

Modeled after PayPal, it processed $2.3 billion worth of transactions in 2020 and $8 billion during the past four years, according to Tayo Oviosu, the company’s chief executive officer who founded it in 2009. Paga could reach a valuation of at least $1 billion “in the next year or two,” Oviosu said in an interview.

Tech unicorns -- startups with a valuation of $1 billion or more -- are less of a rarity in Nigeria as companies catering to a large unbanked population revolutionize the way people transfer money and pay for goods and services. A crop of firms from Flutterwave to Interswitch have achieved that status.

Oviosu, who returned to Nigeria from the U.S. more than a decade ago with a Stanford MBA and experience at companies like Cisco Systems Inc (NASDAQ:CSCO)., wouldn’t disclose the company’s current valuation.

But he’s already setting his sights outside his home country by looking to expand to Ethiopia and Mexico, where it could similarly facilitate payments for the millions who lack access to banking services. Paga’s foray into Ethiopia, Africa’s second-most populous nation, is planned for next year.

To expand Paga’s reach, the company is counting on what it considers a game-changer of a deal with Visa Inc (NYSE:V). The agreement will provide for merchant solutions in Nigeria from this month, allowing payments by money transfer and a QR code among others.

“It has significant potential to grow our revenue,” Oviosu said.

Central to Paga’s business is a network of agents who effectively perform the functions of a bank teller.

Deployed across Nigeria, the company’s 27,000 agents are registering new customers for Paga accounts and helping them process payments or put cash into a bank deposit. Paga is also making its programming interface available to tech entrepreneurs for payments while expanding its consumer business through the partnership with Visa.

The West African nation, where 60 million people are among the unbanked, is embracing the boom in fintechs that are promoting inclusion through mobile payments. Many startups are concentrated in Yaba, a district in the commercial hub of Lagos that’s also attracted the likes of Facebook Inc (NASDAQ:FB). and Google (NASDAQ:GOOGL).

The technology industry is also increasingly in favor with lenders in the economy of Africa’s biggest oil producer. The government has similarly taken notice, spending more on tech infrastructure to boost innovation and create jobs.

Given Paga’s growing business footprint and the prospects for additional fundraising, Oviosu thinks becoming a unicorn is only a matter of time.

“We are focused on making it simple for people to pay, get paid, shop and sell,” he said. “I know the runway to where we are projecting to be from where we are today.”

 

Nigerian Payments App Paga May Be Africa’s Next Unicorn
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Jun 11, 2021 11:49
Saved. See Saved Items.
This comment has already been saved in your Saved Items
This is good news for Nigeria and Africa at large it will help boost Nigeria's economy and attract more investors in Nigeria.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email