MEA Fintech Weekly News: Are Neobanks the Next Big Thing for Nigeria?

MEA Fintech Weekly News: Are Neobanks the Next Big Thing for Nigeria?

This week marked a new win for digital banks in Nigeria. Neobank Sparkle raised US$3.1 million in a seed round for expansion efforts (TechCrunch).

Founded by former CEO of Diamond Bank Uzoma Dozie, Sparkle provides both individual and business banking services. It is licensed in Nigeria as a micro financing bank.

The seed round was led by Leadway Assurance, along with participation from Trium Network and undisclosed high-net-worth individuals. The investment comes after Sparkle closed a friends and family pre-seed round of US$2 million within the past year.

Funding will be used towards building a robotic automation system for repetitive processes, and hiring across the neobank’s engineering, finance risk and marketing teams, the report said.

It added that despite over 50% of the population being banked, inefficient services, downtimes and bad loans have led to a “love-hate relationship” between customers and traditional banks.

In contrast, digital banks in Nigeria have been attracting some of the biggest funding rounds this year (data according to Crunchbase), indicating growing investor interest in this space. Kuda, one of the top digital banks in Nigeria, raised two funding rounds this year, a Series A for US$25 million followed by a US$55 million Series B. Another Nigerian digital bank FairMoney raised US$42 million Series B this year as well.

More recently, digital bank Prospa raised a similarly sized pre-seed round, fetching US$3.8 million.

MEA Fintech News Highlights

Regional news

Google for Startups awarded equity-free funding to 50 African tech startups, including 16 fintechs from Nigeria, Kenya and Ghana, through its US$3 million Black Founders Fund Africa (Disrupt Africa).

GIZ and Fintech Galaxy launched the Yalla Xtech Accelerator Program for Arab tech startups, including fintech startups (Zawya).

Safaricom launched a mini-app within its M-Pesa super app for health insurance (Tech Metro Africa).

Saudi Arabia

Saudi BNPL company Tamara launched a “Split in 6” feature for online purchases at furniture retailer IKEA (Zawya).



RAKBANK and MasterCard partnered over a companion app for RAKBANK’s Emirates Skywards World Elite MasterCard Credit Card called firefly (The Fintech Times).

Microsoft and the Abu Dhabi Investment Office launched a fintech-based GrowthX Accelerator programme in the UAE (The Paypers).

UAE’s DIFC and CBUAE announced a partnership to jointly develop fintech initiatives (Fintech News Middle East).

Commercial Bank of Dubai and Bahrain’s Infinios Financial Services announced a strategic partnership to boost fintech development in the UAE (company announcement).



MasterCard makes Apple Pay available to its users in Qatar (The Paypers).


Airtel Money, I&M Bank Tanzania launch mobile-app based digital lending service Kamilisha (Telecom Paper).

South Africa

south africa

South Africa-based fintech API developer Ukheshe Technologies is looking to raise US$100 million for acquisitions over the next 12 months (The Africa Report).



Canada-based, Nigeria-focused raised US$620,000 in a pre-seed round for its automated credit assessment (Techcabal).

Nigerian open banking startup Mono raised up US$15 million in a Series A round (Fintech News Africa).


Nairobi-based fintech investor Lendable announced plans to raise US$100 million for African and Asian SMEs, including off-grid energy projects (Bloomberg).



Egypt-based digital payments startup Khazna selected for inaugural edition of Bill & Melinda Gates Foundation-funded Last Mile Money Accelerator (The Startup Scene).

Egypt-based “save your money pay later” service Sympl officially launched its checkout platform (Zawya).


Sudanese alsoug picks up US$5 million to build a national payments network (Fintech News Africa).

Recommended Reading

“Although the country did have some early adopters in the space of digital banking, these were largely traditional banking incumbents (mainly Emirates NBD and Mashreq Bank). Now, UAE digital banks are not only growing in number, but also in terms of new players…” Read more about the top digital banks in the UAE.

“African fintech companies have raised more in the first seven months than they have in the decade before, according to one report. Between January and September this year, African fintech companies have raised a touch near US$1.5 billion. That, against the US$1.06 billion they raised all across 2011 to 2020, is a clear indication of accelerated interest…” Find out more about Africa’s five fintech unicorns.

That’s it for the week’s MEA fintech news. Subscribe to our Middle East and Africa newsletters to continue receiving the top MEA fintech news in your inbox.

This article was originally published on Fintech News Africa.

Featured image: edited from Unsplash

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