The Nigerian based fintech startup, Opay has today announced raising $120million seed fund from Chinese investors in a Series B of funding just a few months after raising $50 million.
The funding was led by Series B investors which include Meituan-Dianping, GaoRong, Source Code Capital, Softbank Asia, BAI, Redpoint, IDG Capital, Sequoia China and GSR Ventures.
It is so glaring that OPay has been on an aggressive growth path since it launched in Nigeria last year.
Originally founded and incubated by Opera, OPay has grown from a payments company to a jack of all trades intent on becoming a super app.
Opera’s activity on the continent represents both trends. The Norway-based, Chinese-owned (majority) company funded OPay in 2018 on the popularity of its internet search engine.
The company has built a hefty suite of internet-based commercial products in Nigeria around OPay’s financial utility. These include motorcycle ride-hail app ORide, OFood delivery service and OLeads SME marketing and advertising vertical.
“OPay will facilitate the people in Nigeria, Ghana, South Africa, Kenya and other African countries with the best fintech ecosystem. We see ourselves as a key contributor to…helping local businesses…thrive from…digital business models,” Opera CEO and OPay Chairman Yahui Zhou, said in a statement.
Opera CFO Frode Jacobsen shed additional light on how OPay will deploy the $120 million across Opera’s Africa network. OPay looks to capture volume around bill payments and airtime purchases, but not necessarily as priority.
“That’s not something you do every day. We want to focus our services on things that have high-frequency usage,” said Jacobsen.
Those include transportation services, food services and other types of daily activities, he explained.
Jacobsen also noted OPay will use the $120 million to enter more countries in Africa than those disclosed.
Since its Series A raise, OPay in Nigeria has scaled to 140,000 active agents and $10 million in daily transaction volume, according to company stats.
Beyond standing out as another huge funding round, OPay’s $120 million VC raise has significance for Africa’s tech ecosystem on multiple levels.
It marks 2019 as the year Chinese investors went all in on the continent’s startup scene. OPay, PalmPay and East African trucking logistics company Lori Systems have raised a combined $240 million from 15 different Chinese actors in a span of months.
OPay’s funding and expansion plans are also a harbinger for fierce, cross-border fintech competition in Africa’s digital finance space. This includes OPay going head to head in Kenya with Africa’s highest volume mobile money product, M-Pesa. Parallel events to watch for include Interswitch’s imminent IPO, e-commerce venture Jumia’s shift to digital finance and WhatsApp’s likely entry in African payments.
The continent’s 1.2 billion people represent the largest share of the world’s unbanked and underbanked population — which makes fintech Africa’s most promising digital sector. But it’s becoming a notably crowded sector, where startup attrition and failure will certainly come into play.
OPay’s latest funding round comes just a few days after other big investment in Nigerian fintech companies. Last Monday, Interswitch announced a $200 million investment from Visa and days later, Palmplay a payment service from Transsion Holdings announced a $40 million seed funding round. All three funding activities are part of a trend in fintech investment over the last four years.