Nigerian fintech startup, Cleva, secures $1.5 million pre-seed to enhance international payments in Africa

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January 8, 2024
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2 min read
Founders of Cleva

The news:

  • Cleva, a Nigerian fintech startup, has raised $1.5 million in pre-seed funding to improve international payments across Africa.
  • 1984 Venture, a San Francisco venture capital firm focused on helping early-stage startups, led the round with participation from several investors, including FirstCheck Africa, Y Combinator, The Raba Partnership, and Byld Ventures. 
  • Cleva has several upcoming products, including USD cards and savings in U.S. assets, in the works to diversify its revenue streams. It also plans to launch a campaign aimed at African diasporans. 

According to the company’s website, these products will enable users to send USD internationally and create professional invoices, putting them in a competitive remittance market that already includes platforms like Flutterwave's Send, Chipper Cash, Lemfi, and Afriex.

Tolu Alabi (CEO) and Philip Abel (CTO) founded the fintech in 2023 to offer US-based accounts to people and companies in Africa so they could receive US dollars.

Cleva allows users to open USD accounts by providing their Bank Verification Number (BVN) and a government-issued ID. 

Cleva only offers USD accounts, but other fintech companies like Geegpay also offer GBP and EUR accounts. It is developing a few digital products, such as USD cards and savings in US assets. Cleva is also looking to branch into API issuance. 

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On why they launched despite a fiercely competitive market, Alabi emphasised the ongoing challenge for African businesses and individuals to receive international payments for their services and goods. 

The fintech says it sets itself apart from the competition in two crucial areas: the customer experience and business model. It claims to have processed over $1 million in payments per month for thousands of users since its four-month debut in Nigeria. 

Cleva estimates that the market for processing payments for freelancers and remote workers in Africa is worth $18 billion. 

According to Alabi, the company plans to address issues with international payments in Latin America, Asia, and Canada. However, because they were familiar with the African market, they chose to begin there. She is confident that they have what it takes to tackle this issue globally, given their experience.

Meanwhile, the startup levies a 0.9% fee on deposits made into clients' USD accounts. It sets a fee cap of $20, setting itself apart from rivals that frequently charge an uncapped 1% fee no matter how much is received. 

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Cleva caps fees at $20, distinguishing itself from competitors who often apply an uncapped 1% fee regardless of the amount received.

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