Fido, a prominent fintech lending platform in Ghana, has successfully secured $30 million in new funding to bolster its expansion across the African continent. The funding package includes $20 million in Series B capital from global impact investment manager BlueOrchard and the Dutch entrepreneurial development bank FMO, alongside $10 million in debt funding from Stanbic Bank Ghana and Growth Investment Partners (GIP). This latest infusion of capital underscores Fido's ambitious plans to broaden its financial solutions and reach within Africa's burgeoning fintech landscape. Fido, which currently provides credit access to individuals and micro, small, and medium enterprises (MSMEs) in Ghana and Uganda, will use the new funds to enhance its product offerings, including small business loans, savings, and personalized insurance. The company has already made significant strides, serving over 1 million clients as of August 2024, with 40% of these clients being small businesses. It has disbursed over $500 million in loans across Ghana and has extended its services to 50,000 customers in Uganda. BlueOrchard, in its partnership with Fido, aims to integrate insurance coverage for climate-related risks into Fido's loan products. This move highlights a growing trend among investors to address environmental and social governance (ESG) factors within financial services. Alon Eitan, Fido’s CEO, emphasized that the latest funding would accelerate the company’s growth and enhance its ability to serve the unbanked population across Africa. The $10 million debt funding from Stanbic Bank Ghana and GIP will support Fido’s entry into new markets and further development of its existing services. This diversified funding approach reflects a strategic effort to fortify Fido's financial base and expand its market footprint. Ghana's digital lending sector is witnessing rapid growth, driven by increasing smartphone penetration and a growing demand for accessible credit. However, this growth is not without challenges. In June 2024, the Ghana Cybersecurity Authority (GCA) reported that 38 digital lending mobile applications were involved in cyberbullying, a concern that underscores the need for robust regulatory frameworks and ethical practices in the sector. The broader context of digital lending in Ghana and West Africa reveals a complex landscape. While the market is projected to grow significantly, reaching $2 billion in the Middle East and Africa over the next five years, issues such as data privacy and ethical loan recovery practices remain prevalent.
Play audio
No comments