Against all odds and the abuse to the mindset of rushing to foreign venture capitalists for investment, a Nigeria fintech startup that is merely 2 years old raises $1.1 Million from a group of Nigerian investors led by Olumide Soyombo, Co-Founder of Leadpath, who have helped the company raise the fund.
piggybank.ng is an online savings platform that enables savers to put away funds that they don’t want to withdraw easily. They can save as little as $1 a day and then restrict when they withdraw their savings to specific set dates they choose. Unlike a regular bank’s savings account, where you can access the money at any time, piggybank.ng helps its users maintain their savings discipline while building their savings culture, as they save towards something big. Piggybankers can earn on average 6% per annum on automated savings or 10.95% per annum on the fixed deposit product, Safelock and can withdraw funds for free once per quarter.
Piggybank.ng was founded by three former covenant University students. The COO, Odunayo Ewiniyi said we are a team of three co-founders, myself, Somto Ifezue and Joshua Chibueze who met originally at Covenant University, Nigeria. We have worked together for almost 8 years now on different startups and businesses and in 2016, we came together again to tackle the huge issue of savings in Nigeria. Maintaining discipline in Savings was a problem that we as individuals had, and we later realized that we were not alone. The majority of Nigerians, in fact, Africans, need to save a minimum of 40% of their monthly income, in order to survive and to pay for even the basics such as housing, access to healthcare and school fees. piggybank was built to tackle this huge and under-served market.
This is how they will spend their fund
Odunayo Ewiniyi said we recently applied for and secured a micro-financing license from the Central Bank of Nigeria[CBN], which was a long-term investment for us. We are also hiring talent in marketing, product and tech departments, as we continue to introduce new products and grow our user base.
Unlike other recent funding rounds, where start-ups have looked outside of Nigeria for VC investment, you’ve raised $1.1M from almost exclusively Nigerian investors – what does this say about the market?
We are extremely proud to have had such incredible support from the local Nigerian investment community, and I hope that our engagement with local investors now opens up opportunities for other start-ups, who often assume they have to go abroad for investment. Many of our peers have to fly across the continent, or head to the US or to Europe to raise a similar Seed Round. Whilst we’ve naturally held a lot of conversations with a number of different stakeholders through this fundraising process, essentially, as a team, we’ve been able to stay in Lagos and spend time working on and refining our product, and most importantly, talking to customers. There is wealth in Nigeria, and so much of it is channeled towards infrastructure, agriculture, real estate, petrochemicals and so forth, but we have seen very little [in real terms]local institutional investment into the tech ecosystem, and it shouldn’t be like that. So we’re grateful for Olumide Soyombo of Leadpath, for connecting us with a local investor network.
This is another good news to the tech community. Seems the fintech is winning now, banks too are not sleeping. When Shola, CEO of Paystack was asked will Fintech chase banks away, d he said
..We will live together in peace