There are still so much unexploited opportunities in the African health payment market. This is what the Amsterdam and Nairobi-based startup, CarePay International is looking to tap into. With £40 Million in new funding, the startup is trying to expand to more territories.
Key Analyses
- The startup is smarter here. It is choosing to expand more on its investment in Nigeria with a population of 200 million people (and which had the value of transactions conducted through mobile devices rise by 56 per cent in the first nine months of 2018 alone to N216bn from the 2017 figure of N138bn (about $600 million).
- And it is also choosing Tanzania,the sixth most populous country in Africa ( which had the value of Mobile Money Transactions reaching TZS 50 Trillion ( about $22 billion) in 2016–17) as the starting point of its investment targets.
- With the latest funding of £40 million, CarePay is already one of the most funded startups in the whole of Africa, in the rank of Andela, others.
- The startup is going to Health tech in the countries and it plans to digitally connect health players including insurers, users, and providers on a single mobile platform, so that they can communicate and make transactions in real-time.
- The startup was also strategic with this round of fund raising as it targeted a pool of investors from different investing backgrounds, in order to give the startup a two-sided look: that of generating a social outlook for the startup and bringing back financial returns. Dutch private equity funds IFHA-II, impact investor ELMA Investments, Dutch Ministry of Foreign Affairs which invested through the PharmAccess Group are some of the mixture of investors for this round.
- In 2015 alone, investors poured over 14 billion USD into fintech companies globally while African fintech startups have attracted almost 30% of the total VC investments into the continent, which amounts to nearly $50 million.
- By December 2017, 49.1 per cent (338.4 million) global mobile money accounts were in Sub-Saharan Africa. Within the region, East Africa had 56.4 per cent of the accounts, followed by West Africa at 30.9 per cent. In Eastern Africa, 66 per cent of the adult population of Kenya, Rwanda, Tanzania and Uganda combined actively used mobile money.
- Although health insurance coverage is still low in many countries in Sub-Saharan Africa, mobile money use may have increased access to it. Kenya’s social health insurance, the National Hospital Insurance Fund (NHIF), for instance, experienced a 500 per cent increase in voluntary payment subscribers between 2009 and 2017 after the organisation started receiving payments via M-PESA
Also See: Kenyan e-Health Startup Raises $3m For Expansion
CarePay International was launched in 2015.
“The mobile phone allows you to reach everyone at almost no extra cost, this creates unprecedented opportunities for health insurance schemes,” said Onno Schellekens, CEO of CarePay International.
“Universal health coverage in Africa will only be possible if governments and their citizens can provide and access health services from both the public and private sectors through seamless and efficient mechanisms, CarePay brings that ambitious vision within the realm of possibility,” said Tom McPartland, a Board member of ELMA Investments.
“The current health insurance model excludes huge parts of the African population as the administrative costs are too high, there is not enough data and outpatient costs cannot be controlled,” said Max Coppoolse, IFHA-II’s Managing Partner. “CarePay’s mobile technology addresses all these elements and in addition offers cross-sale opportunities and other significant growth prospects for insurers.”
CarePay International works with private and public health payers, connecting millions of people to its platform that are currently excluded from quality healthcare services in Africa.
Charles Rapulu Udoh
Charles Rapulu Udoh, a Lagos-based Lawyer with special focus on Business Law, Intellectual Property Rights, Entertainment and Technology Law. He is also an award-winning writer. Working for notable organisations so far has exposed him to some of industry best practices in business, finance strategies, law, dispute resolution and data analytics both in Nigeria and across the world.