MyCredit Investments Limited, operating as FairMoney Nigeria, is thrilled to announce the successful debut of its N2.5 billion ($5.39M) Series 1 Commercial Paper (“CP”) Issuance. The CP programme received tremendous interest from qualified institutional investors, with total demand exceeding the issue size by almost 100%.

The CPs were issued with a 270-day tenor and offered investors a yield of 16.00%. This strong response to the Offer demonstrates the investors’ confidence in FairMoney Nigeria’s operations and strategic direction.

The Programme and subsequent CP Issuance mark a significant milestone for FairMoney, providing the company with continuous access to funding from the dynamic debt capital market. The achievement highlights FairMoney’s commitment to sustainable growth and meeting the financial needs of its diverse customer base.

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The CP Issuance aims to support the company’s short-term liquidity needs and finance the growth of its loan book. Financial advisory services for the transaction were provided by United Capital Plc, Renaissance Capital Africa, FBNQuest Merchant Bank, and Stanbic IBTC Capital Limited. This collaboration with renowned institutions showcases the widespread recognition and support for FairMoney’s innovative financial instruments and the company’s dedication to building a robust funding base in Nigeria.

Reasons for Investment:

Investors were drawn to FairMoney Nigeria’s CP Issuance for several key reasons:

1. Company Performance: The strong demand for the CPs reflects investors’ confidence in FairMoney’s operations and strategic direction. The company has consistently delivered on its financial obligations to a diverse range of investors, fostering trust within the investing community.
   
2. Credit Ratings: FairMoney Nigeria recently received double investment grade credit ratings from GCR and DataPro. This creditworthiness enhances the company’s appeal to investors and demonstrates its financial stability.
   
3. Market Potential: FairMoney aims to become the financial home for the underbanked individuals in emerging markets, targeting the next 2 billion people who lack access to adequate financial services. This ambitious vision presents significant growth potential, attracting investors seeking exposure to underserved markets.
   
4. Innovative Financial Instruments: FairMoney’s innovative approach to providing access to quality finance products is gaining recognition among investors. The CP Issuance establishes the company as a category leader in debt instruments, offering investors a new and attractive asset class.

A commercial paper issuance is the process of issuing short-term debt securities called commercial papers to raise funds from investors. These unsecured promissory notes are offered at a discount to their face value and have a specified maturity date. Institutional investors participate in these issuances, attracted by their low risk, short-term nature, and higher yields. The funds raised through commercial paper issuances are used by the issuing entity to fulfill short-term liquidity needs and meet immediate financial obligations. Overall, commercial paper issuances provide a quick and efficient way for companies and institutions to access short-term funding from the investor market.

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A Look at FairMoney Nigeria

FairMoney Nigeria was founded in 2017 with a mission to increase its portfolio while delivering services to financially excluded and underserved individuals. The company aims to serve as the financial home for the next 2 billion underbanked people in emerging markets.

The co-founders of FairMoney Nigeria include Laurin Hainy, who serves as the CEO and Director General, and Henry Obiekea, who serves as the Managing Director. Since its inception, FairMoney has expanded its operations beyond Nigeria and extended to India in 2019.

FairMoney primarily operates in Nigeria and India, targeting individuals who lack access to traditional banking services. The company’s focus is on delivering quality finance products to the financially excluded and underserved population.

The recent success of FairMoney Nigeria’s CP Issuance highlights its commitment to sustainable growth, financial inclusion, and meeting the diverse financial needs of its customer base.

Charles Rapulu Udoh

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

A merchant payment service that caters to small companies, PayForce (a sub-brand of YC-backed CrowdForce), has been bought by Nigerian credit-led digital banking network FairMoney.

FairMoney hopes to offer more financial services to retailers through this approach. The deal’s specifics weren’t made public. Yet, the transaction was reportedly a cash and stock sale for between USD 15 million and USD 20 million.

While FairMoney has mostly maintained a credit-led neobanking strategy aimed at retail clients, CrowdForce offers agency banking services through PayForce, a branchless banking model that extends financial services to the last mile through a network of human ATMs. Yet, as the digital retail and merchant banking industry increases, multiple iterations, competition-induced innovation, and attracting venture funding have driven both organisations to grow from their core products to a variety of offers.

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PayForce began by giving POS devices to merchants and enabling them to offer cash-in, cash-out, transfer, and bill payments to retail consumers while supplying liquidity through a network of partners. The fintech has expanded its product range to include business banking, finance team tools, B2B payments, and virtual cards. It currently serves over 10,000 organisations. In February 2022, it raised a USD 3.6 million pre-Series A round.

FairMoney, on the other hand, began with a digital lending product that provides loans to mostly retail clients for periods ranging from 15 days to 24 months. The company, which received a USD 42 million Series B in 2021, currently offers debit accounts and cards, peer-to-peer transfers, and payments to over a million retail clients and small enterprises, which have grown to be a significant part of its business.

PayForce-acquired merchants that utilise FairMoney as their main bank should get incentives from the acquisition, such as an 18% annual return on deposits. In order to address one of the greatest issues small companies in Nigeria face, FairMoney seeks to provide customised credit solutions for all types of enterprises. Furthermore, it is not absurd to believe that FairMoney may attempt to bank some of the offline clients CrowdForce has provided over the years.

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Fintechs on the opposite side of the board, like OPay and Moniepoint, are gaining retail consumers as consumer digital banking firms like FairMoney and Kuda foray into commercial banking. Because multiple client profiles on one app have varied banking demands, the shift hasn’t been easy for most of these players.

FairMoney will be hoping that PayForce, which provides a merchant-focused value proposition that allows small businesses to better understand their finances and generate more revenue through its product, will provide it with a merchant-focused value proposition that will strengthen its position in the country’s business banking space.

Indeed, FairMoney hopes to increase its market share and become Nigeria’s leading retail and merchant bank with the purchase. For its retail consumers, the fintech wants to add credit cards, remittance, stock, and investment products, as well as payroll services, BNPL, and online merchant purchasing to its business-facing product portfolio.

Charles Rapulu Udoh

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

Three months after raising a $42 million Series B funding, FairMoney has secured additional funding to develop new digital banking services in Nigeria.

The funding came from the UK investment holding firm TLG Capital. 

The investment was carried out via Africa Growth Impact Fund (AGIF), an investment vehicle managed by TLG Capital, and which targets SMEs in English-speaking sub-Saharan Africa. Although the amount committed has not been disclosed, AGIF is known to make investments of between $ 1 million and $15 million.

FairMoney, which started operations in Nigeria in 2017 and extended to India in 2019, wants to “increase its portfolio while delivering services to financially excluded and underserved people,” according to Laurin Hainy, the company’s co-founder and director general.

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Tiger Global Management, DST, Flourish Ventures, Newfund, and Speedinvest contributed $42 million in Series B funding to the financial institution that now includes TLG Capital as an investor.

Laurin Hainy, Matthieu Gendreau, and Nicolas Berthozat co-founded the digital bank, which began with mobile loans before expanding into savings and investment products. 

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FairMoney, which has over 5 million clients in Nigeria and India, was given quality issuer ratings (BBB / A3 / Stable) as well as long-term BBB (NG) and A3 (NG) short-term investment-grade ratings by the South African financial rating agency Global Credit Ratings due to its strong liquidity, resilient balance sheet, good underwriting practices, and strong growth trajectory (GCR).

Charles Rapulu Udoh

Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning writer

One of Nigeria’s emerging fintechs, FairMoney, which started out as a lending business has started process of completing its evolution into being a full-fledged digital bank. The group has announced a $42 million Series B round. It was led by Tiger Global Management with existing investors like DST Partners, Flourish Ventures, Newfund, and Speedinvest participating. 

The investment comes after FairMoney raised $11 million Series A two years ago and €16 million in total within its first four years. 

For Tiger Global which led the round, this is its fourth investment in an African startup after iRoko (2013), Takealot (2014) and Flutterwave (2021). Notably, this is the first time the investment firm is investing in two African startups within a year. A sign of its renewed interest in the African continent after a long hiatus.

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Founded in 2017 by Laurin Hainy, Matthieu Gendreau, and Nicolas Berthozat, FairMoney started as an online lender that provides instant loans and bill payments to customers in Nigeria.

From having a little over 100,000 users in its first year of operation, FairMoney has grown to have 1.3 million unique users who have made more than 6.5 million loan applications. Last year, the company disbursed a total loan volume of $93 million.

Since it expanded to India last year, the company has processed more than 500,000 loan applications from over 100,000 unique users.

This year, FairMoney achieved one of its crucial goals by acquiring a microfinance bank license in Nigeria. The license allows FairMoney to operate as a financial service provider in Nigeria.

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Coming off a fantastic 2020, the company says it is projecting to disburse $300 million worth of loans this year. It’ll finance this by raising bonds. FairMoney has come a long way since it started as a credit provider, it’s ambition according to co-founder Laurin Hainy is that “by the end of the year, its customers will have a full-fledged banking experience from P2P transfers and lending to debit cards and current accounts.”

It’s also working on a number of additional services including savings, stock trading, and crypto-trading products. These are subject to regulatory approvals.

With this new funding, FairMoney wants to focus on Nigeria and India, consolidating its position before any expansion. While it’s not expanding further geographically, its talent pool is, with about 150 open positions.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry