Five Nigerian Fintech Startups That Could Become The Next Paystack

The year 2020 saw fintech becoming more important than ever as firms rushed to embrace digital transformation in response to the crisis caused by the COVID-19 pandemic.

With the need for pandemic proofing still on the rise, digital payment solutions are projected to experience tremendous levels of user adaptation in 2021. Quite a number of fintech companies have emerged, offering payment solutions to individuals and organizations, but we have our eyes on a few companies which may just be the next “Paystack”.
 

For context, what/who is “Paystack” and why should you care?

Paystack is a Nigerian fintech company, which was incorporated in Delaware, United States in 2015 (the same year it joined the Y Combinator Accelerator) whose purpose is “solving payment problems for ambitious businesses”.

Through its private beta launch in November 2014 and public launch on January 11, 2016, Paystack has been describing itself as the “Stripe for Africa”, as both of them solve the same problem: payment, by providing a quick way to integrate payment services into an online or offline transaction by an API (Application Programming Interface). This means they have been able to connect all multi-channel payment options with merchants across the country, and enabled them to accept payments from around the world via credit card, debit card, and direct debit transfer on the web and mobile.

On October 15, 2020, Paystack made the news after Stripe; the world’s most valuable fintech company, and the company which inspired Paystack, announced that they had acquired Paystack in a deal worth over $200million dollars when they sought to expand into the African continent. This was not the biggest startup acquisition to come out of Nigeria but has also set the company on an inspirational growth trajectory. 

Nigeria is now home to over 200 independent fintech companies. Many Nigerian fintech startups have shown great promise in offering payment solutions, and we have put up a list of five Nigerian fintech offering payment solutions that just might be the next big thing in the global fintech space:

READ ALSO: Stripe, Flutterwave Reacts As Rival, Paystack, Get Acquired
1.    Chatpay

Chatpay allows users to transact businesses through their various social media handles. This is a major leap in the innovation of banking solutions that can enable hundreds of millions of daily active users on Facebook, Twitter, Telegram, etc. the ease of performing their financial transactions. It creates a seamless method of transaction and further creates an avenue for young people, who would ordinarily transact in cash to be ingrained in the formal financial system through electronic transactions. 

2.    CashEnvoy

With the clampdown by PayPal on payments made to and from Nigeria, coupled with the increase in the number of online businesses from Nigeria, a need for online payment solutions has become pertinent. CashEnvoy seeks to be “Nigeria’s PayPal” as they allow people to send and receive money, as well as make payments on CashEnvoy enabled websites while charging no upfront integration fees. Websites using CashEnvoy can be found on The Nigerian Shopping Guide.

3.    PayPad

PayPad is a mPoS (mobile PoS) solution – the first of its kind in Nigeria – that allows merchants to accept card payments using their smart mobile devices (tablets and phones). PayPad is a product of Electronic Settlement Limited, the same company that brought us CashEnvoy. This is such a promising innovation, as small business owners who cannot afford the traditional PoS machines do not have to remain unbanked. Receiving payments with PayPad is as simple as typing in the transaction amount on your smart device, and merchants can send an e-receipt to the customer’s e-mail address. We believe this can go on to become one of the leading payment solutions in the continent in a few years.

4.    Amplify 

Amplify is a Nigerian fintech solution whose primary offerings are mTransfers (a social banking solution that enables users to transfer funds and perform other banking services via WhatsApp, Facebook Messenger, Instagram, and other social media platforms without leaving the platform or switching apps) and AmplifyPay (a payment gateway that enables subscription-based businesses to accept recurring payments). The company, Amplify Payments Limited was acquired in 2019 by One Finance and Investment Limited (OneFi) for an undisclosed fee, which gives a little hint into the inherent value of this startup. We envisage this company scaling major heights in the near future.

5.    Flux by Blueloop

Blueloop is solving cross-border payments from merchants and gig-workers using a remittance platform named Flux. Flux is a hybrid app that combines the world of cryptocurrency wallets and a digital banking app. Users can receive cryptocurrency from all over the world and immediately convert it to fiat money. This is because the platform has a wallet as its main feature that is designed to convert cryptocurrencies to cash in real-time. It is also possible to make some direct spending through the Flux wallet. Interestingly, Blueloop just got $77,000 seed capital in December 2020 to start Flux, after it got accepted into Pioneer, an accelerator launched by ex-YC partner Daniel Gross in May 2020, and they have already started gaining the attention of users within and outside Nigeria. There is such huge potential for this startup as it could quickly catch the attention of major investors. 

Conclusion 
The year 2021 looks very promising for fintech in Nigeria, as great solutions are emerging, coupled with the rising interest of local investors. Moreover, these are just a few mentions among the many promising startups in Nigeria.