Cross-border payments fintech TerraPay gets $20m from BII

STARTUP VENTURE CAPITALJuly 15, 2024 at 2:48 PM UTC

TLDR

BII provides $20 million senior secured loan to TerraPay for facilitating lower-cost digital money transfers to Africa.
TerraPay connects traditional money transfer operators and digital fintechs with major mobile money operators in Africa.
Funding from BII will be used to pre-fund increased remittance volumes to key African corridors, including Kenya, Ghana, Egypt, Uganda, and more.

British International Investment (BII), the UK's development finance institution and impact investor, is extended a $20 million senior secured loan to TerraPay, a global cross-border payments processor with a strong focus on remittance transfers to Africa.

TerraPay's network directly connects traditional money transfer operators like Western Union and digital-only fintechs such as Wise with major mobile money operators in Africa, including M-Pesa, MTN MoMo, and Airtel Money.

This facilitates lower-cost digital money transfers, addressing the challenges of high transfer fees and slow settlement times for the African diaspora sending money home.

Key Takeaways

Remittance costs for the sub-Saharan African region remain the highest in the world. In 2022, sending $200 to the region cost an average of 8%, compared to the global average cost of 6.2%. This is more than double the Sustainable Development Goal target of 3%, according to the World Bank. BII’s funding will be used as part of TerraPay’s working capital to pre-fund increasing remittance volumes to Africa. It will prioritize key African corridors, with high volumes anticipated in Kenya, Ghana, Egypt, Uganda, Tanzania, Cameroon, Mali, Benin, Côte d'Ivoire, Senegal, and Mozambique.

BII

TerraPay

Western Union

M-Pesa

Wise

MTN MoMo

Airtel Money

Remittances

Fintech

Venture Capital

Venture Debt

Venture Financing