Pennee, a Nigerian fintech startup, has gained the attention of investors with its innovative approach to providing credit and cash flow management tools to micro and small businesses in Nigeria. The country has the largest economy and population on the African continent, yet faces a significant funding gap for MSMEs, estimated at $158bn per annum by the World Bank, with Nigeria’s GDP reaching $506.6bn in 2023 and a population of 213 million.

Pennee’s aim is to fill this gap by offering a revolving credit account for the purchase of inventory, linked to specific vendors, decreasing risk in the loan portfolio, and improving collection rates. This, coupled with the company’s cash flow management tool, enables business owners to build the operational and management KPIs and skills necessary to grow their business while improving working capital management.

Unlike traditional lenders, Pennee’s credit accounts target Gen Z and millennials, comprising around 50% of Nigeria’s population. These individuals have historically faced challenges accessing credit due to a lack of credit history, collateral assets, financial literacy, and strict lending criteria. By providing a digital credit account and cash flow management tool, Pennee could help MSMEs scale beyond their “micro” size, contributing to economic growth and creating job opportunities in Nigeria.

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Since its founding in 2019, Pennee has been sourcing loans for business owners via peer-to-peer funding, a model that has remained resilient despite the COVID-19 pandemic, with most business owners adapting to the new normal quickly and moving their businesses online. To support the peer-to-peer model, Pennee keeps an 80:20% ratio on wallet deposits and transactions, which is used to give asset-based loans and overdrafts to these businesses.

Pennee is part of the Techstars 2023 acceleration cohort, offering the company valuable resources and support to help it grow. With sales and inventory management, customer relationship management, business intelligence and analytics, and a mobile wallet for transactions backed by Providus bank, Pennee provides a comprehensive package for small businesses to automate accounting, store transaction history, and download financial statements.

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Recognizing the potential of Pennee, First Circle Capital, an investment firm focused on early-stage startups, has invested in the company. Pennee’s founders believe that sustainability and scalability are the keys to success, and they are looking for investors who share their vision and want to be part of it. With its innovative approach to providing credit and cash flow management tools to micro and small businesses, Pennee is well-positioned to make a significant impact in Nigeria’s economy and beyond.

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