M-KOPA secures $75M in funding.
Without collateral or a guarantor, the company allows underbanked customers in specific African areas to access a wide range of products and services.
M-KOPA’s fifth equity round is referred to as the “growing equity round” in its press release.
M-KOPA has raised $190 million in total equity.
This round included previous investors such as the CDC Group and LGT Lightrock, as well as LocalGlobe’s Latitude Fund and HEPCO Capital Management.
The company is led by the CEO and co-founder Jesse Moore.
M-KOPA is best recognized for its pay-as-you-go (PAYG) financing strategy, which allows customers to build appliance ownership over time by paying an initial deposit and then making flexible micro-payments.
M-KOPA began with solar-powered home systems aimed at low-income and rural consumers who lacked access to electricity in Kenya, Tanzania, and Uganda.
It has, however, expanded its pay-as-you-go model to cover additional necessities, such as cellphones (first introduced in Kenya two years ago), televisions, freezers, solar lighting, and digital financial services such as cash loans and health insurance.
The geographical scope of the organization has also shifted.
M-KOPA was largely focused on East Africa six years ago, but after pulling out of Tanzania, it is now present in Kenya, Uganda, Nigeria, and Ghana.
M-KOPA expects to launch in one new market this year and in 2023 as part of its growth ambitions, which are based on this recent funding.
In the second half of this year, the ten-year-old company wants to expand its offerings in Nigeria, and in Q1 2023, in Ghana.
The platform matches fractional payment periods with customers’ daily or weekly earning and spending cycles to deliver finance and digital financial services to underbanked consumers in four geographies.
Its customers span from ride-hailing drivers to small-business owners who manage their firms using cell phones.
However, in a market where a large percentage of adults make less than $5 per day, a $100 smartphone is a luxury.
M-KOPA claims to have secured more than $600 million in finance for its 2 million underbanked customers across its markets to far.
Beyond asset financing, though, the Kenyan firm has a wider goal in mind.
M-KOPA will be able to scale financial services products like health insurance, cash loans, and BNPL merchant partnerships as a result of the new investment, which will allow the company to grow its flexible daily and weekly payment model.
In addition, M-KOPA intends to spend more in order to develop its client relationships and technology.