AFRICA – Accion Venture Lab, a seed-stage investment initiative has secured US$ 33 million in additional funds to finance fintech startup globally, with the team estimating up to 30 percent of this will go to fintech startups in emerging markets in Africa.
Accion committed US$10 million to the fund and acquired the remaining balance of US$23 million from a co-investment vehicle with third party funds, including the Ford Foundation, Blue Haven Initiative, Proparco, Prudential Financial, Stichting Hivos-Triodos Fund, and Visa.
Despite the advances made in technology, many people especially those living in the African Continent have limited access to safe and convenient financial services.
President and chief executive of Accion, Michael Schlein said, “Despite progress, three billion people still have no safe or simple way to save money, get a loan to build a business, pay a bill, or protect their health and property with insurance”
Fintech startups are bridging this gap in the financial sector by coming up with innovative products that make it easy and convenient for the underserved population have access to financial services.
Schlein however noted that despite their efforts in solving problems in the society startups often “lack the capital and strategic support they need to grow and scale their impact”
He noted that in addition to the enterpreneural challenges that all startup face, fintech startups are exposed to unique challenges like tight margins, high levels of competition and varying regulations that make it difficult for their investments to grow.
“To address these needs, Venture Lab – typically the first institutional investor in its portfolio companies – provides both capital and extensive strategic and operational support across a broad range of functional areas,” Schlein added.
Accion Venture Labs was launched in 2012 by Accion International and focuses on providing support to innovative fintech startups that improve access, quality, and affordability of financial services for the underserved at scale.
In africa, Accion Venture Labs operates from three regional offices located in Kenya, Nigeria and South Africa.