Investors update: TymeBank raises $77.8m

South African digital bank TymeBank raises $77.8m

Highlights

• South African digital banking platform TymeBank has raised $77.8 million pre-Series C, with plans to close its Series C round later this year. 
• The round was led by African-focused growth-stage fund Norrsken22 and Swiss global impact investment firm Blue Earth Capital. 
• A member of the Tyme Group of companies headquartered in Singapore, Tymebank offers a transactional bank account with zero or low monthly fees and a savings product to its customers.

Source: Finextra

Our Takeaway

Digital-only banks have gained popularity in Africa in recent years, offering a range of banking services through a mobile app or website, without the need for physical branches. Notable names include Kuda, Carbon, and Fairmoney in Nigeria and Discovery in South Africa. That’s where TymeBank differs, as most of its customers are onboarded via physical locations. Altogether, these banks have attracted millions of customers, especially among the younger generation, due to their ease of use, lower fees, and innovative features. With the increasing adoption of smartphones and mobile technology in Africa, neobanks are well-positioned for growth and have the potential to reach previously underserved populations.

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E3, Lion’s Head Africa-focused climate fund hits first $48m close 

Highlights

• The E3 Low Carbon Economy Fund for Africa (E3LCEF), a fund by early-stage VC E3 Capital, and emerging markets-focused investment bank Lion’s Head Global Partners has hit the first close at $48.1 million.
• The E3LCEF limited partners include FMO, Swedfund International AB, Proparco, and KfW, in partnership with BMZ, the German Ministry for Economic Cooperation and Development.
• The fund targets to close at $100 million and will provide initial and follow-on funding to startups, such as solar providers and EV startups, supporting low-carbon economies.

Source: TechCrunch

Our Takeaway

The new fund is part of a slew of climate-focused African funds that have launched recently. African climate tech startups secured over $860 million in 2022, and this year, firms such as Novastar Ventures, Catalyst Fund, and Equator are raising or have raised climate-tech funds for Africa. Other African climate-focused investment vehicles that have raised capital recently include Satgana, AfricaGoGreen Fund (AAGF), which closed the second tranche of its fundraising in February, and the Energy Entrepreneurs Growth Fund (EEGF), which raised over $110 million last year. Oxfam Novib and Goodwell also launched a new fund to provide venture debt to startups in this space.

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Brazil-based fintech unicorn Ebanx to double down on Africa

Highlights

• Ebanx S.A. plans to expand into eleven countries in Africa by the end of the year, hoping to replicate its fast growth in Latin America, and plans to initially focus on mobile money.
• The company started operations in Kenya, South Africa, and Nigeria last August amid soaring demand for payments via mobile phones in recent years.
• The Brazilian startup, valued at over $1 billion, also aims to reach agreements with major e-commerce stores to provide payment services on the continent. Without disclosing names, Ebanx plans to focus on partnerships with global merchants.

Source: TechCrunch

Our Takeaway

Per a GSMA report, Africa accounted for over 66% of the world’s $1.26 trillion mobile money value after mobile money transactions on the continent rose 22% between 2021 and 2022. It’s widely believed that Africa’s fintech-powered digital economy is only in its early days and Ebanx’s move seeks to tap into Africa’s fast-growing digital payments space and broader digital economy, driven by the rise of fintech companies like Flutterwave, MFS Africa, and OPay, the very payments startups which are about to face competition from the Brazilian unicorn.