Kwara, a fintech startup based in Kenya, has raised $4m in a seed funding round to build a credit union powered neobank for the emerging market.
The seed round was led by Breega with participation from SoftBank Vision Fund Emerge, Finca Ventures, New General Market Partners and Globivest.
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Others who joined the round include Do Good Invest, Rabacap, Launch Africa, Norrsken Impact Accelerator, Future Africa, Samurai Incubate, DOB Equity and fintech angels.
Kwara will use the proceeds to develop their neobank app.
Kwara offers banking-as-a-software service to credit unions to help them digitise their operations and offers their customers access to its app.
The app can be used by credit union’s members to make deposits directly into their credit union accounts, repay loans, and apply for instant loans, while tracking their finances and payments.
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By GlobalDataAdditionally, the fintech is working on an open banking technology through an API allowing credit unions to integrate with payment gateways, banks and third-party vendors.
Breega founding partner Ben Marrel said: “Kwara’s unique approach is a catalyst for a new way of retail banking through digital-first credit unions. We are both proud and excited to be helping this outstanding team scale across Africa and other emerging markets”.
Kwara estimates that currently, in emerging markets over 300 million people use credit unions to bank and that number is growing at 6% YoY.
The fintech aims to take that number to at least 1 billion by the end of the decade.
Kwara co-founder and CEO Cynthia Wandia said: “We are building a solution for people – an estimated one billion – who do not currently have access to personalized banking services. This is the result of a gap in banking-grade technology and the lack of neobank-like experiences for the end clients.”
