Despite the significant impact remittance has on developing countries, the cost of sending money across borders is still above the United Nations sustainable development goal of 3% with Sub-Saharan Africa having the highest average remittance cost of about 7.8%.
Founded in 202o, Kotani Pay is solving this problem by allowing people to access blockchain technology to send and receive money without the need of internet connectivity or a bank account.
“Our initial solution used Unstructured Supplementary Service Data (USSD) that enabled simple withdrawals of digital assets to local fiat currency. However, we have had iterations of the solution to enable users to register for specific programs such as universal basic income (UBI) claims. Our latest offering has decentralized finance (DeFi) elements that are built into the USSD interface,” the company said.
“For the crypto currencies received, we enable our users to withdraw cash in the form of mobile money in local currencies using Kotani Pay digital wallet. This can be done via SMS, so no internet connectivity or a bank account is required.”
Kotani Pay works with Celo dollars (cUSD), a stablecoin on the Celo Blockchain which is pegged to the price of the US dollar.
To expand its operations, Nairobi-based crypto-fintech startup, Kotani Pay has secured $2 million pre-seed in a funding led by P1 Ventures, with participation from various investors including DCG/Luno and Flori Ventures.
After two years of offering this service in Kenya, Ghana, Zambia and South Africa, the startups wants to use its latest funding to expand to Rwanda, Senegal, Ivory Coast, Tanzania, and Nigeria.
Kotani Pay also intends to further expand its offerings by introducing other products including Money Ledger (a Ledger-as-a-Service solution) and Reconset (a Reconciliation-as-a-Service solution) following its acquisition of Nigeria-based Fintech startup, Fuhlstack.