Kenya Wapi Pay Raises $2.2 Million In Pre-seed Funding To Support Cross-border Payments Between Africa And Asia In The Future

Kenya's Wapi Pay raises $2.2 million in pre-seed funding to support cross-border payments between Africa and Asia in the future

According to the World Bank, sending money to people in Sub-Saharan Africa is more expensive than sending money to people anywhere else in the world. It is also the most expensive region in which to send money internationally. People spent an average of 8.9 percent of their disposable income sending money to the region in the first quarter of 2020. This is significantly higher than the global average of 6.8 percent.

There has been a lot of discussion about remittances from Africa to the West, with many startups employing both traditional fiat currency and cryptocurrencies in their operations. Cross-border payments between the two corridors should be made easier. However, there has been little discussion of the corridors that connect Africa to other regions such as Latin America and Asia.

For example, the average remittance cost in South Asia is the lowest in all of the regions, at 4.95 percent on average (these percentages). Consequently, it makes sense to take advantage of the opportunities presented by the market (which will be reported with a standard $ 200 remittance). As part of this strategy, Wapi Pay, a Kenyan startup with offices in both China and Singapore, has created a new market by facilitating payments between the extreme remittance worlds of Africa and Asia.

Wapi Pay was established in 2019 by the Ndichu brothers, Paul and Eddie. It allows African businesses to send and receive money from Asia via mobile money platforms and bank accounts through a payment gateway.

The flow of funds for remittances to Africa is the primary focus of the remittances study. as a result, it has been digitalized Focus on delivery rather than developing new infrastructure and payment processing models for African individuals and businesses in order to facilitate the creation of cross-border payments in many cases.

Financial institution that is still operational Traditional systems and communication models are used to provide service to customers. These transactions are, in essence, inherently complicated due to the compliance requirements. It becomes even more opaque, time-consuming, and expensive to process due to the lack of new infrastructure or processes. Cryptographic money transfer startups claim to be able to solve this problem, but so far no one has been able to scale their services to a useful level.

How WapiPay Works

We started WapiPay to see how fragmented our payment infrastructure is and how terrifying the experience and costs of making and receiving payments with and from Asia are, according to founder Peter Ndichu, who spoke with TechCrunch about the company. I was ordered to do so.

“Because of the growing trade relationship between the two corridors, we decided to spend some time in Asia.” The evolution from remittances to global payments, as well as the need to make them more efficient, faster, and less expensive, were all witnessed in [Africa and Asia]. Because of the nature of these transactions, they are already complicated. How can something be as simple and straightforward as mobile money? He went on to say more.

The value of trade between Africa and China increased by 27 percent in the first quarter of 2021 compared to the same period in 2020, reaching $ 52.1 billion. Despite the economic recovery following the pandemic, African merchants continue to find it difficult to send and receive money internationally. Some of these costs, particularly in Southern Africa, can be as high as 20% of the total. Also ridiculous are the waiting times, with some people having to wait as long as one week before their payments are processed. Wapi Pay claims to be able to process payments within a day and to charge a flat fee of no more than 3 percent.

“WapiPay eliminates the need for traditional payment networks while increasing your efficiency and lowering your costs. Users can select their preferred delivery channels, which include options such as bank-to-bank transfers, wallet-to-wallet transfers, bank-to-wallet transfers, wallet-to-bank transfers, and more. Choose between settling within 24 hours, transferring funds, or paying merchants, according to CEO Eddie in a press release.

Wapi Pay currently collaborates with local banks and platforms in China, Indonesia, India, Japan, Malaysia, the Philippines, Singapore, Taiwan, Thailand, and Vietnam, among other countries. Since 2019, the company claims to have grown by 396 percent year on year, and it expects to continue growing in this manner. Wapi Pay hopes to process $ 500 million in remittances by the end of next year, as well as increase the number of African merchants and Asian suppliers to 500,000 and 100,000, respectively, by the end of the year. 

To achieve these objectives of expanding global payments and remittances between Africa and Asia, the $ 2.2 million pre-seed investment announced today is critical to the success of the initiative.

This round is one of the most important in East Africa, if not the entire continent. Among the ventures taking part is MSA Capital, a China-based fund that is well-known for its investments in Unicorn Meituan, Nubank, and Clarna. The pan-African and pan-African-focused companies Echo VC, Kepple Africa, and Future Hub, as well as the pan-Asian companies Transion Holdings and Gobi Ventures, are among the most notable examples.

In Conclusion

WapiPay will use the funds raised from this investment to approach regulators about licensing, scale, products, and geographic expansion opportunities throughout Africa.

“These funds will assist Wapi Pay in diversifying its product offering and driving growth, allowing remittances to evolve into real-time, global cross-border payments, including in Africa and Asia. Yes, you can. “It should be as simple as sending an M-PESA, with the cost of the transaction kept to a bare minimum,” Eddie continued.

“From Africa to Asia is a vast trade corridor that is underserved and overlooked by today's technology,” says the author. The Wapi Pay team, we believe, is the most qualified to develop the infrastructure required to support growing trading volumes... NS Excited They can rely on our extensive Chinese fintech network and playbooks for assistance. MSA Capital Vice President Tim Chen made the announcement in a statement.