In a significant development, Watu Credit in Uganda has successfully raised an initial 5-year term facility of US$15 million from Gateway Partners through their Africa Credit Opportunities Fund. This funding, the first tranche of a larger initiative to raise US$50 million, is aimed at supporting Watu Credit’s mission to enhance financial inclusion in the region.
Headquartered in Nairobi, Watu Credit is an Asset FinTech company operating in seven African countries. Established in 2019, the company specializes in providing loans for mobility and connectivity assets, such as smartphones, two & three-wheelers, electric motorbikes, and cars. Watu Credit has been at the forefront of revolutionizing financial inclusion for the unbanked and financially underprivileged.
Watu Credit’s unique business model focuses on offering affordable financing options to riders, providing them with an opportunity to achieve financial security and ownership of essential assets like motorcycles. These vehicles often serve as the main source of income for many riders.
Gateway Partners, an emerging markets manager, has played a crucial role in this funding initiative. Their investment through the Africa Credit Opportunities Fund aligns with the strategic goal of using capital to empower “base-of-the-pyramid” clients while incorporating basic credit risk mitigation measures.
The subordinated debt investment made by the fund will contribute to Watu Credit’s balance sheet growth and facilitate the “crowding-in” of additional senior debt financing. Watu Credit’s business strategy, rooted in financial inclusion, resonated with Gateway Partners’ mission to positively impact emerging markets.
Watu Credit’s business model is designed to serve the unbanked and financially underprivileged population, providing them with essential financial services and opportunities. Specializing in financing two-wheelers, the company leverages technology extensively in its operations, utilizing automated procedures, GPS monitoring devices for motorbikes, and exclusive use of digital payments through mobile money wallets.
The infusion of funds from Gateway Partners will not only strengthen Watu Credit’s position but also contribute significantly to advancing financial inclusion in Uganda. As the company continues to grow and diversify its mobility portfolio, it aims to make a lasting impact on the lives of the underserved and unbanked population, offering them a pathway to financial security and empowerment.
This funding milestone is a testament to the collaborative efforts of Watu Credit and Gateway Partners in driving positive change and fostering financial inclusion in the African continent.
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert. As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard.