Financial literacy levels have been on the rise across the African continent. Young tech-savvy Africans have been at the centre of this. In the past, the safe wealth-building investments in Africa included land and real estate. Other options were treasury bonds, T-Bills and fixed options.
Those investments were, however, available to high net worth individuals. But Africans have demonstrated an appetite for affordable investing. In the past year alone, bitcoin adoption in Africa grew by 1,000 per cent from peer-to-peer transaction volume totalling USD 105bn according to Chainalysis. This shows that young people are looking for alternative assets to grow their wealth.
Enter Chipper Cash and Eversend
Fintechs have noticed this phenomenon and acted accordingly. Chipper Cash is one of them. The startup started as a peer-to-peer cross border money transfer platform. It then expanded its services to include remittances.
Chipper Cash is one of Africa’s most funded startups. It has raised USD 302m across 6 funding rounds since 2019. It’s last funding round, a USD 150m Series C, saw the startup become one of the few unicorns in Africa with a rumoured valuation of over USD 2bn. This funding round was led by Sam Bankman-Fried’s cryptocurrency exchange platform FTX.
After this funding round, Chipper Cash announced a partnership with New Jersey-based DriveWealth LLC, a digital trading technology company that builds API-based brokerage infrastructure. Through this partnership, it will be able to bring fractional share investing which is very convenient for African countries with lower valued currencies.
For as little as USD 1, Africans in Ghana, Uganda, Kenya, Nigeria and South Africa can buy and sell stocks of publicly listed companies on the New York Stock Exchange in their local currencies by topping up their wallet, selecting the stock to buy/sell and then confirming the entire transaction.
But Chipper Cash is not the only one that is targeting this market. Eversend, the multi-currency wallets platform founded by Stone Atwiine, Emma Sanchez and Andrade Smith in 2017 and headquartered in France is also bringing access to US stocks and ETFs to Africa soon. According to its website, users can sign up and get early access.
The startup was originally built to cater for Africans in the diaspora across the globe through cross-border transfers, virtual debit cards, multi-currency e-wallet insurance solutions and offline access to funds. In Africa, Eversend’s main markets include Nigeria, Uganda, Rwanda and Kenya. Users can also trade cryptocurrencies on both platforms, even though the options are still limited to Bitcoin, Ethereum and Doge.
Featured Image Courtesy; Freepik