The variety of POS terminals in Nigeria grew from 150,000 in 2017 to 543,000 in April 2021, based on Statista. Throughout that interval, the quantity of POS payments within the nation additionally elevated tremendously, hitting greater than 500 billion as of Might 2021.
In Nigeria, POS terminals are used to course of card funds at retail areas in addition to for company banking functions, a branchless banking system the place brokers act like human ATMs. And whereas terminals have completely different suppliers (banks and fintechs) and functionalities, they primarily function on-line with just a handful of them having offline capabilities too.
Lagos- and Helsinki-based ZirooPay, one such supplier, has raised an $11.4 million Collection A spherical led by Lagos-based VC fund Zrosk Investment Management. Present buyers Nordic enterprise fund Inventure returned, with participation from different personal and institutional funds akin to Fedha Capital and Exotix Advisory.
Particular person buyers like Petri Kivinen, the previous managing director at Deutsche Financial institution, Morgan Stanley and Renaissance Capital; Abiodun Ajai, the director, Sub-Saharan Africa of Financial institution of America; and Jonas Dromberg, former Bureau chief at Bloomberg, additionally took half.
This new capital will be deployed towards increasing its cost infrastructure, accelerating development and rising its workforce, the corporate stated.
In 2014 when we featured the company, the pitch then from IroFit (ZirooPay’s guardian firm) was that its “Web-free” tech —a cell platform for small companies to just accept card funds by way of a cell app and EMV-certified card reader — operated in areas the place there isn’t a knowledge protection, notably in rising markets.
Solely based mostly in Helsinki on the time, CEO Omoniyi Olawale stated the funds it raised ($600,000 in seed) would provoke a launch in Nigeria. Nonetheless, it wasn’t till 5 years later that the agency accomplished that launch in Lagos. And on a latest name with TechCrunch, Olawale stated the delay occurred as a result of his firm, which raised an extra €2 million, was fine-tuning its know-how and including extra capabilities.
That pitch stays unchanged and after three years in operation, ZirooPay has grown immensely. In accordance with the corporate over 15,000 retailers use its POS terminals and cell software. These retailers have processed $500 million — a 5,000% enhance inside three years — throughout 10 million transactions, the corporate continued.
One of many greatest challenges to the mass adoption of card funds at retail areas is the speed of transaction failures as a result of poor web connection. “That led to us creating our in-house know-how we’ve got a patent for that enables us to course of these occasions in actual time with out web connection,” stated Olawale about his resolution to make ZirooPay offline-first.
“So the product obtained constructed round that main drawback; with that, we are able to determine to offer a 95% transaction success charge in opposition to the lower than 50% that you just discover out there,” he added.
The subsequent large ache level for POS terminals is performance, which implies what different options can they provide past processing funds. Each retail and agent interplay with prospects is an information mine to the cost processor and retailers. However since POS terminals hardly have bookkeeping capabilities, what occurs as a rule is that retailers manually reconcile their books day by day or depend on Khatabook-esque platforms akin to Kippa to digitize their processes.
However ZirooPay is telling retailers who use its platform to not look elsewhere. Its cell software permits small companies throughout the retail, company banking, hospitality and providers sectors to carry out comparable duties, akin to monitoring gross sales and managing enterprise operations, stated Olawale.
“Take into consideration the whole lot that the money registers seen in large supermarkets can do; with an Android software and a cell point-of-sale card reader, we offer that very same performance to small companies,” he remarked.
“We’ve been capable of see over 70% of our customers migrate from paper-based accounting to rely on the in-app gross sales accounting inside three months of onboarding.”
The expansion funding will assist ZirooPay increase its product suite and embody further cost channels and choices in a bid to construct out an omnichannel system for retailers. And as POS suppliers in Nigeria, notably fintechs, more and more give attention to company banking—an enormous fintech phase that closely drives monetary inclusion—ZirooPay fancies the prospect of dominating an open retail house.
“No main firm is coming in with trendy know-how attempting to deal with this house and that’s one space that we see a chance for us as a result of we’re primarily a retail cost platform. Despite the fact that we offer company banking on the facet, our focus is on retail, and that’s one thing that differentiates us from the opposite gamers,” stated the CEO.
Samson Esemuede, the managing director and chief funding officer of Zrosk, stated of the funding: “The expansion within the on-line financial system of the African continent has been exceptional; nevertheless, the offline financial system is orders of magnitude bigger than the web financial system.
“ZirooPay has a patented know-how benefit (that works with out an web connection) and distribution mannequin that considerably will increase the percentages of digitizing the offline financial system at a unit value that makes the story notably compelling. The cost house has turn into well-resourced and aggressive, however the white house we see within the digitization of money is the rationale we’re optimistic concerning the outlook for this funding.”