South Africa’s Stitch secures $25m Series A extension
South African fintech Stitch—which focuses on enabling businesses to build, optimize, and scale financial products and providing API gateways to improve the conversion for online payments and optimize payment operations of its clients—has raised $25 million in an extension round of funding led by global fintech investor Ribbit Capital.
That brings the startup’s total Series A to $46 million, having previously announced a $21 million raise in February 2022. Existing backers, including CRE Ventures, PayPal Ventures, and the Raba Partnership, participated in the round. This is Ribbit Capital’s third investment in Africa after leading Chipper Cash’s $30 million Series B and Wave’s $200 million Series A.
The fintech has now raised $52 million in venture capital (including a $6 million seed). The company, which has over 80 employees, plans to use its Series A money to continue developing its platform, expanding its customer base, and seizing opportunities to serve new markets.
Across Africa, open banking has seen considerable traction in recent years with several startups enabling developers to build for the continent with ease and quickly. Commercial banks and other financial institutions also partner up with API startups to provide digital financial services. The future of financial services in the region rests on interoperability across several players and services. As the fintech startup ecosystem matures, we expect to see infrastructure-focused startups seek growth opportunities in new markets, supported by increased venture capital backing and consolidation. This is even more significant considering Africa has more than 500 million underbanked or unbanked, less than 50% of the continent’s adult population have made or received digital payments and more than 40 million merchants do not accept digital payments.