In February, the Nigerian technology startup CrowdForce announced a big break: It had received $3.6 million from investors to expand its financial services operations to many more underserved communities.
Co-founder and Chief Executive Officer Tomi Ayorinde said new funding will boost its mobile agent network from 7,000 to 21,000 this year.
"We were looking to scale faster and really gain market share," Ayorinde said. "And what we're doing is also very impact-related because we're creating jobs, avenues for people to make extra income in their communities. So, it was also very interesting for impact investors to be part of what we're trying to do."
When Ayorinde helped launch CrowdForce seven years ago, he intended it to be a data collection company. But after about two years, the company overhauled its business model when Ayorinde realized it could fill a need for bank accounts.
"When we collected data of 4.5 million traders what we saw was, a lot of them didn't have bank accounts and the ones that have bank accounts had a very tough time accessing the cash that was sent to them," said Ayorinde."That's when we kind of realized that there's a bigger problem to solve here.”
Experts say about 60% of Africa's 1.2 billion people lack access to banks or financial services. Technology startups in Africa are trying to fix that, said the African Private Equity and Venture Capital Association known as AVCA.
In a recent report, the industry group said African startups attracted $5.2 billion in venture capital last year, and that West Africa – led by Nigeria – accounted for the largest share of investments.
AVCA research manager Alexia Alexandropoulou said investors are looking to tap into Africa's huge population of young people.
"Africa is the world's most youthful population, so as the proportion of skilled labor increases, then the result will be more human capital in order to power African businesses and also the industrial development within the continent," said Alexandropoulou.
AVCA's report also cites increased internet penetration in Africa and more favorable government policies as contributing to increased investments in financial technology services knwoFintech.
But Fintech Digital Marketing Expert Louis Dike said there are obstacles to overcome, such as weak currencies and policies.
"Africa is not a perfect place because it's still made up of virgin markets," said Dike. "The standard of living is quite low, our regulations are not consistent, today the government will say this and tomorrow they will change the law and restrict some startup activities."
But with new talents emerging in technology, more startups with big dreams are emerging in Nigeria and elsewhere in Africa.