ZirooPay, a mobile POS supplier based in Lagos, has secured $11.4 million in a Series A round headed by Zrosk Investment Management, a Lagos-based venture capital firm. Old investors Nordic Inventure and other private and institutional funds such as Fedha Capital and Exotix Advisory returned.
Individual investors included Petri Kivinen, a previous managing director at Deutsche Bank, Morgan Stanley, and Renaissance Capital; Abiodun Ajai, a director at Bank of America’s Sub-Saharan Africa division; and Jonas Dromberg, a former Bloomberg bureau chief.
According to the startup, the new funds will be used to develop its payment infrastructure, accelerate expansion, and increase its personnel.
IroFit, ZirooPay’s parent organization, pitched its “Internet-free” technology as a mobile platform for small companies to receive card payments via a mobile app and EMV-certified card reader in locations where there is no data access, especially in emerging economies.
CEO Omoniyi Olawale, who was based only in Helsinki at the time, stated that the cash-secured ($600,000 in seed) would be used to start the company in Nigeria. Nevertheless, the company did not finish its launch in Lagos until five years later.
Olawale further explained that the wait happened because his organization was fine-tuning its technology and expanding its possibilities after raising an additional €2 million.
That pitch hasn’t altered, and ZirooPay has increased tremendously in its three years of existence. Over 15,000 merchants use the firm’s POS machines and mobile app, according to the organization. The business said sated that these merchants have handled $500 million, a 5,000 percent growth in three years over 10 million transactions.
In order to create an omnichannel system for retailers, ZirooPay will use the expansion investment to grow its product suite and incorporate other payment channels and possibilities. And, as POS suppliers in Nigeria, especially fintech, increasingly concentrated on agency banking, a huge fintech area that fosters financial inclusion, ZirooPay sees an opportunity to dominate an open retail space.
Techbuild’s Take
If the COVID-19 lockdown taught us anything, it was that some types of work can be done effectively remotely.
Typical instances include buying and selling, as well as other associated financial services. Young Nigerians were also exposed to delivering financial services on a local level as a result of the lockdown.
According to Statista, the majority of POS points in Nigeria increased from 150,000 in 2017 to 543,000 in April 2021.
POS machines are used in Nigeria to handle card payments at retail outlets and for agency banking, a banking method that does not need a bank branch in which agents operate as human ATMs.
While terminals have a variety of suppliers (banks and fintech) and functionality, they all work largely online, with only a few having offline features.
This isn’t to imply that branchless banking is without its drawbacks, one of which is the high rate of transaction failures caused by a poor internet connection. Companies, on the other hand, are constantly devising new ways to make banking more convenient for individuals.
According to Olawale, this led to ZirooPay developing its own technology, and the firm now has a patent that allows it to process such events in real-time without requiring an internet connection.
Every engagement with a retailer or an agent is a data mine for payment processors and merchants. However, because most POS terminals lack bookkeeping capabilities, automating their procedures for appropriate bookkeeping is difficult.
However, ZirooPay’s mobile app enables small businesses in the retail, agency banking, hospitality, and services industries to undertake similar duties like monitoring sales and managing operations.
Although it’s interesting that the once cash-oriented Nigerian population is now embracing cashless payments as a mode of transaction, it’s also important to mention that it’s assisting to tackle Nigeria’s unemployment crisis while also promoting financial inclusion.
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