CrowdForce raises $3.6M to enhance access to cash for underserved Nigerians

Nigerian finance service provider, CrowdForce recently announced that it had closed $3.6 million in pre-Series A funding, including $1 million in debt. Aruwa Capital Management led the round. Other participants were HAVAC and AAIC.

According to reports, only about a third of Nigerian individuals have access to a bank branch or ATM within a kilometer of their home. Because of the difficulty in obtaining financial services, especially for the unbanked and underbanked, agency banking has emerged. Through a network of agents, this branchless banking approach brings financial services to the last mile. It's a booming sector for banks, larger fintech like OPay and TeamApt, and CrowdForce.

With a focus on the underserved, CrowdForce is enhancing seamless access to crucial financial services. The company is aggressively achieving this by increasing its distinct competitive advantages through its product and service offerings, proprietary technology, and broad agent distribution network across the country.

The startup was founded by CEO Oluwatomi Ayorinde and COO Damilola Ayorinde in 2015 as MobileForms, a data analytics platform. At the time, the firm provided data about hard-to-reach rural and semi-urban populations to corporations in a variety of industries, as well as NGOs and development organizations. In 2018, MobileForms completed KYC for the Nigerian government's TraderMoni small credit program on 4.5 million eligible micro-traders.

“We thought that if we could build this successfully well, several other fintechs can layer to deliver their services to the mass markets and that will still be in line with our objective of building our distribution,” said CEO Oluwatomi Ayorinde. “When you look at most of the successful companies in Nigeria, they all had to build some sort of offline distribution.”

MobileForms also allows users to create forms with a simple drag-and-drop interface and share them with other team members with a single click. Team members can log in and begin collecting data on mobile devices using the app. However, when executing the TraderMoni project, the duo realized there were much deeper issues that needed to be addressed.

While working on TraderMoni, a small credit scheme for micro traders pioneered by the Nigerian government, the company had its first big break in 2018. The goal was to provide these small company owners with revolving loans to help them grow their firms and get out of poverty. The problem was that there was no database to run this application on.

The startup’s POS service, PayForce, offers ATM services, transfers, and bill payments, and is used by market clusters and small enterprises to address high cash demand from customers in locations where bank branches are not available. PayForce assists retailers in safely managing their cash float while also allowing them to make additional income by serving as an agent.

Pharmacies and reseller networks are among the firms that receive the fintech company's POS terminals. It claims to have the largest liquidity among Nigerian agent banking networks, leveraging more than 1.7 trillion through its partners, and has partnered with 19,000 fuel stations, 20,000 resellers, and 6,000 pharmacies to widen its distribution network.

CrowdForce charges a 0.6 percent commission on all transactions made by its partners and has been cash positive since 2020, rising by 25% month over month to service 1.9 million unique clients in 25 Nigerian states.