Kuda Is Expanding Global Push As Scramble For African Diaspora Heats Up
Kuda, the Nigeria-operating London-headquartered fintech challenging traditional banks by offering mobile-first and personalised banking services, is doubling down on its global expansion plans. The company, having secured a payment license in Canada earlier this year, is set for a Q3 2024 launch of its multi-currency digital wallet in the country. This service targets the large African diaspora population in Canada, with an estimated Nigerian contingent of over 100,000.
“With the launch of our digital wallet in Canada, we will offer Africans living in the country, including recent migrants, a simple, transparent, and cost-effective way to send money home,” said Babs Ogundeyi, Group CEO and founder of Kuda. Ogundeyi emphasizes the importance of remittance services, stating they “improve their financial well-being and strengthen their connections to their countries of origin.”
The digital bank has seen some success since launching in Nigeria in 2019. Kuda claims to have up to 5 million users, more than thrice the number it had during its USD 55 M Series B round in August 2021; money it had said it raised to enter into other African countries like Ghana and Uganda, though expansion into those countries is yet to materialise.
This Canadian launch follows Kuda’s initial foray outside of Africa in November 2022, targeting Nigerians in the UK with a remittance product. The company’s strategy hinges on offering a cheaper and more convenient alternative to traditional money transfer services. Kuda’s digital wallet allows users to add funds in various currencies, including GBP, EUR, USD, and CAD, for transfers to African countries.
The company sees a significant business opportunity. The remittance sector is a major draw, with remittance inflows to Africa reaching an estimated USD 54 B in 2023 per the World Bank. By targeting markets with large African diaspora populations, like Canada and the UK, Kuda is positioning to capitalise on this growing demand and boost its foreign exchange revenue.
While international money transfer operators like WorldRemit, Western Union, Wise and Remitly continue to dominate key remittance corridors, African consumer fintechs are increasingly carving out their own space, muscling in through multi-currency wallets, competitive transaction fees and varying exchange rates. Notable players include LemFi, Send by Flutterwave, Grey Finance, Kyshi, Eversend and NALA which just announced an impressive USD 40 M Series A, among others.
Also, Kuda’s focus on markets with a burgeoning African migrant population presents a significant opportunity to enhance its foreign exchange revenue. The plummeting local currencies and fluctuating foreign exchange rates pose challenges for local startups, and Kuda’s expansion strategy offers a potential hedge.
The company’s ambitions extend beyond remittance. Its initial launch in the UK included plans for additional services like direct debits and local transfers, suggesting a broader financial services play for Africans globally. Kuda has also secured a payment license in Tanzania, hinting at further African expansion plans.
Kuda’s global ambitions are fuelled by its mission to serve the African diaspora. By leveraging technology and strategic partnerships, the company aims to provide a one-stop shop for financial services, ultimately aiming to be a financial lifeline for Africans abroad. Whether Kuda can successfully navigate the complexities of global expansion and deliver on its promises remains to be seen. But it’s clear that Kuda is a player to watch in the evolving fintech landscape for Africans around the world.
