How Kora’s UK expansion will impact Africa’s payment ecosystem
Kora has expanded into the UK to provide payment processing gateway and portals, as well as merchant service aggregation from the Kingdom to Africa.
Last week, a Nigerian payment infrastructure company, Kora expanded into the United Kingdom. This expansion is part of the company’s partnership with the municipal government of Birmingham.
Founded in 2018 by Dickson Nsofor and Bryan Uyanwune, Kora was built to help Africans in the diaspora make remittances into the continent. However, the company pivoted to build a robust payment infrastructure that is enabling both local and foreign businesses to process payments in and out of Africa. Currently, companies like GiG, Juice Africa, dLocal, and PayFuture already use Kora's bouquet of products to power their African operations.
Earlier in 2022, Kora received its commercial Payment Solution Service Provider (PSSP) license [pdf] from the Central Bank of Nigeria, further empowering the company to drive its vision of creating open standards for payments across Africa. The PSSP license allows Kora to provide payment processing gateway and portals, as well as merchant service aggregation. In 2021, the company processed over $1.5 billion in transaction volume in only two African countries—Nigeria and Kenya.
"We started with remittances but we figured out that if we can simplify payment within Africa as well, it will build wealth for the continent," Gideon Orovwiroro, Chief Operations Officer at Kora told Benjamindada.com during a call. "Going into the UK made sense because we will be enabling payment to move smoothly into Africa." Kora’s API powers businesses to accept payments (pay-ins), disburse them (pay-outs) and do cross-border transfers (settlements).
"[The partners] pulled us to have an office in Birmingham because they can see the value of what we are doing, Birmingham is a critical location in the UK," Orovwiroro said. Located at the heart of the UK’s fastest-growing region in terms of technology, Birmingham is hosting Kora’s first UK office because of its solid infrastructure and ease of access to talent. Kora partnered with the Birmingham city council to power its expansion via the West Midlands Growth Company, regional investment promotion and economic development agency.
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"With this expansion, we can give products like bank accounts to fintechs. Meanwhile, for multinational companies operating in the UK with staff in Africa, we can enable them to effectively integrate an infrastructure that will power salary payments to their team in the country. Generally, merchant payments will become easier." he added.
Kora participated in the 2019 Class of Techstars Toronto Accelerator. The fintech startup later raised $120,000 pre-Seed from Ramen Ventures and an undisclosed funding in 2019, according to CrunchBase.
Despite the growth in cross-border trade, processes remain complex and subject to several barriers. Nika Naghavi, Director of Strategic Projects at MFS Africa explained that bridging the gap between Africa and other regions often still involves chasing partnerships with global payments companies, like Wise, WorldRemit and Alipay. The partnership between the fintech company and West Midlands Growth Company underscores Naghavi’s submission.