TerraPay bags fresh $75m for affordable remittance transfers in Africa
TLDR
- TerraPay secures $75 million in debt financing from the International Finance Corporation for low-cost remittance transactions in Africa.
- Funding includes a $30 million loan from IFC's account, a $15 million B Loan from ILX, and a combined parallel loan of $30 million from OP Finnfund Global Impact Fund I and BIO.
- Focus on driving affordable remittance transfers across Africa with strong financial backing.
UK-based TerraPay, a digital payments provider focused on remittance transfers in Africa, has raised $75 million in debt financing from the International Finance Corporation to drive low-cost remittance transactions across Africa.
The IFC funding is in addition to a $20 million senior secured loan from British International Investment (BII) through Lendable’s existing senior secured facility.
The IFC’s package consists of a $30 million loan from IFC's account, a B Loan of $15 million from ILX under IFC’s B Loan Program, and a combined parallel loan of $30 million from development finance institutions OP Finnfund Global Impact Fund I and BIO.
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. The 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. In July 2023, Safaricom collaborated with TerraPay to enable over 32 million M-PESA customers to send and receive money to over 200 million people in Bangladesh and Pakistan.
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