FinTech FairMoney has raised $42 million in a Series B funding round to expand its financial services offerings in Nigeria and India, Nairametrics reported Friday (July 2).
The Nigeria-based firm provides underbanked users with bill payment solutions and collateral-free lending. The company has recently received a microfinance bank license from the Central Bank of Nigeria, which permits FairMoney to officially operate as a financial services provider in the country.
FairMoney offers loans to individuals and is planning to extend their offerings to small to medium-sized businesses in Nigeria. The company wants to introduce a full range of financial products in their goal to “become the financial hub for its users,” Nairametrics wrote.
“The ambition is that by the end of the year, the customer has the full-fledged banking experience from P2P transfers and lending to debit cards and current accounts. In addition to that, we are working on a number of additional services from savings products, stock trading, and crypto-trading products potentially depending on where regulation is heading,” FairMoney CEO Laurin Hainy said, according to Nairametrics.
The funding round was led by Tiger Global and included existing investors such as Flourish Ventures, DST Partners, Newfund and Speedinvest.
Extending loans to the underbanked in emerging markets is a tricky one, FairMoney Chief Product Officer Rohan Khara told PYMNTS recently. The company manages risk and connects with users by relying on digital banking, mobile devices and advanced technology to aid its credit programs.
“The bedrock hypothesis in any emerging market in order to push the envelope into the next orbit is that you have to take a lot of risks,” Khara said.
FairMoney disbursed $93 million in loans in 2020 in Nigeria alone. They expanded to India last year, where they processed about half a million applications. This year, FairMoney plans to disburse $300 million in loans to their users in both Nigeria and India. FairMoney aims to have 5 million users by 2022.