NIGERIA – OPay, an Africa-focused digital payment startup, has announced in a statement that it has secured US$400 million in its latest funding round led by SoftBank Vision Fund 2, valuing it at US$2 billion.
Other investors in the funding round include Sequoia Capital China, Source Code Capital, Meituan-backed fund Long-Z, Redpoint China and 3W Capital.
OPay, which has notched up 160 million active users in Africa since its launch in 2018, said it will use the capital to invest in African markets including Nigeria and Egypt, as well as Middle Eastern markets.
“We want to be the power that helps emerging markets reach a faster economic development,” said Zhou Yahui, founder and chief executive of OPay, in the statement.
Zhou also founded Chinese gaming company Beijing Kunlun Tech Co Ltd, which was once the owner of the popular dating app Grindr. Washington had ordered Kunlun to divest Grindr in 2019 amid concerns over the safety of its handling of user data.
While the company started with providing customers with digital services in their everyday life, from mobility and logistics to e-commerce and fintech at cheap rates, those super app plans have been largely underwhelming.
Right now, it’s the company’s mobile money and payment arm that thrives the most. By simply allowing unbanked and underbanked users in Nigeria to send and receive money and pay bills through a network of thousands of agents, OPay has grown at an exponential rate.
The company plays in an extremely competitive fintech market. Nigeria is Africa’s most populous nation, and with a large share of its people underbanked and unbanked, fintech is the most promising digital sector in the country.
The same can be said for the continent as a whole. Mobile money services have long catered to the needs of the underbanked.
Parent company Opera reported that OPay’s monthly transactions grew 4.5x to over US$2 billion in December last year. OPay also claims to process about 80% of bank transfers among mobile money operators in Nigeria and 20% of the country’s nonmerchant point of sales transactions.
In 2020, the company also said it acquired an international money transfer license with a WorldRemit partnership also in the works.