African-focused payment platform, Zazuu, has announced that it recently concluded a $2 million fundraise.
The fundraise had participation from investors like Launch Africa, Founders Factory Africa, Hoaq Club, Tinie Tempah, Jason Njoku, CEO IrokoTV, Babs Ogundeyi, CEO Kuda Bank, and other angel investors.
According to the COO, Korede Fanilola, the startup will use the fund to provide improved payment solutions, expand its offerings to users in other European countries, and scale its growth.
“The plan for us is growth. We want to scale our solution as quickly as possible. We’re working on getting licenses that allow us to offer our service to users in other European countries before the end of the year. We’ll also be concurrently improving the product with new features that ensure that everyone sending money to Africa gets the best money transfer experience,” Fanilola said.
The startup, which was founded in 2018 by four African entrepreneurs, was created to help Africans in the diaspora move money with ease.
Zazuu was founded to help immigrant Africans to circumvent the supposedly biased financial system in major destinations of African immigrants.
For instance, according to World Bank’s report on remittance prices around the world, the global cost of sending money across borders averages around 6.09% of the value of the transaction. However, the figure can sometimes get as high as 22% for money sent to African countries.
Although, the lack of needed infrastructure to smoothen the process is usually cited as the reason behind the price hike, World Bank’s remittance report indicts the lack of transparency among remittance providers as the actual leading challenge.
“In addition, a lack of transparency in the market has had the impact of reducing competition, as consumers tend to continue to patronize traditional market players because they are not aware of and cannot compare services, fees, and speed of their existing remittance service against other products,” World Bank report on Remittance Prices Worldwide posits.
Korede Fanilola said Zazuu was founded after the experience he had when trying to send money across.
“In 2018, I sent about $3000 back home to Nigeria. I thought I got the best deal on that transaction until about two weeks later when someone informed me I could have saved up to $30 in fees on that transaction if I had used a different provider. I was livid,” Fanilola said.
“We all have experiences like this where we only discovered in hindsight that we had lost more than we should on transactions back home simply by choosing the right provider,” Fanilola added.
Riding on the back of that experience, Zazuu was founded, and it was founded with the aim of creating a much easier path for Africans to send money without stress.
“The mission has always been simple for us from day one. Africans have consistently gotten the shorter end of the stick with remittance transactions. We discovered that the primary reason for that was a lack of transparency on the part of the providers. We’re solving that problem by building a smarter way to transfer money. With Zazuu, users can search multiple money transfer providers in their region, compare the rates and fees, and then choose who to send money with, at no extra cost,” Kay Akinwunmi said.
Speaking on the fundraise, Akinwunmi expressed his about the investors, and also voiced out his hope for smarter investments:
“We’re happy about the specific investors that have joined us on this journey. We’re always on the lookout for smart investors who offer more than just money; people who share in the vision of a better, fairer world for Africans. With their support, we believe we can build a more equitable financial services ecosystem.”