Smile ID’s Exclusive Deal With Mastercard Comes With A Minority Investment

African digital identity verification provider Smile ID has secured a minority investment from Mastercard while also expanding its strategic partnership with the global payments giant to scale its anti-fraud technology across the continent, the companies said on Thursday.

The deal will see Smile ID’s tools, which verify identities against government data and other local sources, integrated into Mastercard’s digital platforms. This will allow Smile ID to offer its services directly to Mastercard’s network of banks, fintechs, and telecom operators in Africa.

The partnership is a significant step for SmileID in its effort to combat a rise in sophisticated fraud. The company cited the growing problem of synthetic identity fraud, where criminals create fake identities using combinations of real and fabricated information, which it says costs African financial institutions hundreds of millions of dollars annually.

“The surge in synthetic identity fraud is a major barrier to financial inclusion,” said Mark Straub, CEO of Smile ID. “This partnership with Mastercard gives us the scale and insights to help banks and mobile wallets onboard the next 300 million African users securely.”

Selin Bahadirli, Executive Vice President for Services at Mastercard EEMEA, said fragmented identity systems in many African countries can slow business growth and exclude people from the digital economy. Mastercard has operated in Africa for decades and views digital infrastructure as a key area for strategic investment as smartphone penetration increases across the continent.

The expanded alliance positions Smile ID to capitalise on the projected growth of Africa’s digital economy, which some forecasts suggest could reach USD 1.5 T by 2030. The company stated that its integrations with local government databases would be a key differentiator in addressing the continent’s fragmented identity systems.

Mastercard’s minority investment reinforces Smile ID’s position in the market. The strategic backing is expected to help the company accelerate its expansion and enhance its compliance capabilities for clients navigating local and international KYC/AML regulations.

The companies said their goal is to enable safer onboarding for what they estimate could be the next 300 million African users entering the digital financial system.