- Money Fellows has raised $31 million from CommerzVentures, Middle East Venture Partners, Arzan Venture Capital, Partech, Sawari Ventures, Invenfin, National Investment Company (NIC), 4DX Ventures and P1Ventures.
- The startup digitises the Rotating Savings and Credit Association system, also known as Ajo or Esusu.
- With the new round of funding, the startup plans to expand its product offerings which include buy now, pay later, pensions and cards. It also plans to expand its services across Africa and Asia.
Egyptian fintech startup, Money Fellows, has received $31 million from investors in the first close of its Series B round. The startup, which digitises the Rotating Savings and Credit Association system in Egypt, saw CommerzVentures, Middle East Venture Partners and Arzan Venture Capital lead the round.
Partech, Sawari Ventures, Invenfin, National Investment Company (NIC), 4DX Ventures and P1Ventures also participated in this round.
Money Fellows was founded by Ahmed Wadi, the startup’s CEO, in response to his struggles accessing credit while living in Germany. But with a more developed financial system than in Africa, he met little success until he launched the business in Egypt in 2017.
In Africa, access to credit for most individuals is almost impossible, leading many to turn to family and friends for credit. A common practice involves individuals contributing a fixed amount to a common pool, with members taking turns to take the contributions. Known as Ajo or Esusu in Nigeria, it is this system that Money Fellows seeks to digitise.
Although the platform has over 4.5 million registered users, only 7% are active monthly. However, the startup claims to have experienced 8x year-over-year growth. The startup charges users who choose its early spots a one-time service fee of 6%. As more people join the circles, the users are charged a lower percentage.
According to Wadi, its latest funding would enable the startup to expand its product offerings while driving expansion across Africa and Asia. Currently, the startup partners with merchants to sell products to users on its platform, generating revenue by marking up the prices of these products. In the future, it intends to add buy now, pay later, pensions, and cards to the services it offers.