This week, Kredete, a Nigerian fintech, raised $22 million in Series A funding from AfricInvest, Partech, and Polymorphic Capital. The funding comes just three years after launching and brings its total funding raised to $24.75 million. More importantly, it comes just as African startup funding rebounds and suggests strong investor confidence in its mission.
In multiple social media posts following the announcement, leading figures from AfricInvest and Partech have been effusive in their praise for the startup.
“[The] Kredete team is impressive. Their infrastructure is cutting edge. Their customers [love] them. Their vision is ambitious. A perfect match for us and our friends of AfricInvest Group,” Tidjane Deme of Partech wrote on LinkedIn.
“Kredete is disrupting both the way Africans send money back home and the way money gets delivered to Africa. It has been doing this in a unique and efficient way, not relying on incumbent rails. It is on its way to change the way payments are made by building and bringing together an ecosystem of banks, fintechs and users,” Khaled Ben Jilani, Senior Partner at AfricInvest, said.
While many African fintechs focus on fixing payments and credit back home, Kredete is toeing a different path by targeting the growing number of immigrants from the continent. However, when it launched in 2022, its pitch was different from its current focus.
“Kredete aims to empower people and multi medium small-size businesses in Africa by providing them with access to credit, including access to credit scores, reports, education and, most importantly, the support they need to succeed and contribute to the growth of their local economies,” Founder and CEO Adeola Adelewe, himself an immigrant, said in an interview.
Adelewe’s decision to start the company was reportedly influenced by his struggles to access credit to start a business. Consequently, the first version of the product focused on providing improved access to credit through a lending marketplace that didn’t just connect hundreds of lenders to borrowers but also provided an end-to-end platform for lenders to manage the entire process.
The marketplace also provided transparency for borrowers, allowing them to view offers from multiple lenders before making a choice. But beyond that, it provided free credit scores, reports, and knowledge aimed at helping borrowers make an informed choice.
Over the past two years, the company has shifted its focus from primarily serving customers within Africa to improving financial access for African immigrants abroad.
Its platform enables users to build credit scores as they send money back home, bridging the gap between remittances and financial inclusion. Additionally, it offers a cross-border payment solution for businesses and recently launched a stablecoin-backed credit card that leverages blockchain technology for faster and more secure transactions.
Betting on immigrants for growth
Kredete’s focus on immigrants reflects a growing trend. As currency devaluations continue to strain investor confidence in African startups, founders are increasingly looking beyond the continent for growth. For many, Africa’s migrant community presents the most viable opportunity.
Over the past year, Nigerian startups like Moniepoint, Sycamore, Kuda, and Bamboo have rolled out diaspora-focused products in a bid to shore up revenues. They join a wave of remittance platforms such as LemFi and Nala.
Even healthtech startup WellaHealth is eyeing the diaspora’s wallets. For these companies, the appeal is clear: African migrants send home close to $100 billion annually, and getting a slice of that amount could be a game-changer for revenues and lifetime customer value.
That’s the opportunity Kredete is betting on. By using remittance behaviour, the startup can create a verifiable transaction history that would be leveraged to create a credit profile for the user.
“Remittances provide a steady inflow of cross-border cash and verifiable transaction history that can be leveraged for credit underwriting, foreign currency accounts, inflation-protected savings, and simple ways to invest back home — all of which drive recurring fees and high-lifetime-value relationships,” Adefolajuwon Ijaiya, an investment professional, said.
Beyond remittances and credit-building, there’s a bigger opportunity at play for Kredete. From diaspora-funded SME lending to diaspora-targeted savings and investment products, it has the opportunity to evolve into a neobank for immigrants by layering more products. Already, the startup is building the other side of the equation with a USD account and credit card.
However, as Ijaiya notes, its success will hinge on keeping customer acquisition and KYC costs under control. Even then, key questions remain.
“If they’re able to use these cross-border flows to engineer credit scores, the question becomes: to what end? Will they sell those scores to local banks or fintechs? Or will they build their own lending engine? And if it’s the latter, how do they manage recovery and credit monitoring without a strong local presence?”
There’s also the matter of data quality. Can remittance data accurately produce predictive credit signals, and are cross-border flows enough to model borrower risk? The answer, he suggests, depends on the strength of local partnerships, low-cost acquisition channels, and robust alternative-data underwriting models.
What Kredete and others in the space have working for them is the nature of the audience they’re targeting. Migrant populations often congregate in communities — churches, mosques, and cultural groups — making selling to them easier. Furthermore, they earn incomes in the resident countries and frequently have financial obligations back at home.
But the challenge is execution. Immigrants often look to integrate quickly into their new environments and may prefer sticking with established institutions once they do.
To win, startups like Kredete will need to offer not just better features but also culturally relevant experiences and a seamless bridge between their users’ past and present financial lives.
