Coronation-backed Nigerian fintech Woven Finance is shutting down
- Trium's fintech startup, Woven Finance, will be discontinuing its services in the first quarter of 2024.
- Woven Finance, fully licensed by the Central Bank of Nigeria, has decided to transfer its services to Hydrogen, an Access Bank-owned fintech company.
- This move is aimed at enhancing Access Bank's competitiveness against GTCO's fintech, Squad, and is led by Kemi Okusanya, former GM at Visa West Africa.
Woven Finance, the fintech startup established by Trium, a venture group affiliated with Coronation Group, has announced the discontinuation of its services. Customers were informed of this decision through an email on Wednesday morning.
Despite being fully licensed by the Central Bank of Nigeria (CBN) in 2022, with a Payment Solutions Service Provider (PSSP) license, Woven Finance has decided to transfer its services to Hydrogen, a fintech company owned and operated by Access Bank.
This move is seen as an effort by Access Bank to enhance its competitiveness against GTCO’s fintech, Squad. Kemi Okusanya, a former General Manager at Visa West Africa, leads Hydrogen. In the email to customers, Woven Finance stated, "After a thorough analysis of the current market dynamics and their impact on our business model, Woven Finance has resolved to cease its payment services operations in the first quarter of 2024."
The decision by Woven Finance to discontinue its operations may be attributed to several factors, though the exact dynamics remain unclear. One theory suggests that increasing competition from established fintech companies and other bank-led fintechs like Squad, Zest, and Hydrogen could have played a role in this decision. Additionally, global macroeconomic challenges may have influenced investor behavior, leading to reduced funding and potential difficulties for startups in securing commitments. Over the past year, numerous startups, including some that were once highly celebrated, have faced challenges such as downsizing, pivoting, or shutting down operations. At least 15 African startups have reportedly closed down this year, reflecting the impact of various economic factors on the startup ecosystem.