Private investment firm TPG has paid $47.5 million to acquire an unspecified stake in Kenyan digital payments firm Cellulant, which operates in 11 African markets, both firms said on Monday.
Global investors have been eyeing deals in African financial technology firms to take advantage of growth offered by a continent that has used technology to surmount challenges such as low penetration of banking services.
“Across Africa, expanding easy-to-use and low cost mobile banking offers immense potential for impact, and Cellulant is at the leading edge of that work,” said Bill McGlashan, CEO and co-founder of The Rise Fund, the impact investment arm of TPG that invested the cash.
Rise invested together with Endeavor Catalyst, Satya Capital and Velocity Capital. The board of Rise includes rock star Bono, London-based Sudanes tycoon Mo Ibrahim and the founder of eBay, Pierre Omidyar.
TPG said the deal was the largest of its kind in African financial technology firms.
Cellulant, which was founded in Nigeria and Kenya in 2004, offers digital payments platforms and mobile banking services aimed at those who do not have a bank account.
“With two thirds of Africans unable to access a bank account, we believe that building a connected payments infrastructure is the foundation of solving real challenges and accelerating Africa’s growth and development,” said Ken Njoroge, Cellulant co-founder and chief executive.
Njoroge said the new investment would enable the company to expand into new markets and to also invest in its existing operations. Cellulant will also introduce consumer-focused products, it said, without adding details.
Digital financial services are a growing area for other firms on the continent, including Kenyan telecoms operator Safaricom, which pioneered transferring money via mobile phones with its M-Pesa platform in 2007.
Applications created by U.S. firms now offer any Kenyan with a smartphone access to small amounts of credit.