British International Investment backs TerraPay with $20m
TerraPay is a cross-border payments processor with a key focus on remittance transfers into Africa.
** For the best experience, download the free Africa Private Equity News app Android | iOS **
British International Investment (BII), the UK's development finance institution and impact investor, has announced a $20 million senior secured loan to TerraPay, a global cross-border payments processor with a key focus on remittance transfers into Africa.
The remittance costs for the sub-Saharan African region remain the highest in the world. For example, sending $200 to the region cost on average 8% in 2022, while the global average cost for the same amount stands at 6.2%. This is more than double the Sustainable Development Goal target of 3% according to the World Bank.
Through its network, TerraPay connects directly both traditional money transfer operators such as Western Union, and digital-only fintechs like Wise with some of the largest mobile money operators in Africa, including M-Pesa, MTN Mobile Money and Airtel Mobile Money. Its tech-enabled model facilitates real time, lower-cost digital money transfers, tackling the bottleneck of high transfer fees and slow settlement for the African diaspora sending money back to the continent.
BII’s funding will be used as part of TerraPay’s working capital to pre-fund growing remittance volumes to Africa. It will prioritise key African corridors, with high volumes expected in Kenya, Ghana, Egypt, Uganda, Tanzania, Cameroon, Mali, Benin, Côte d'Ivoire, Senegal and Mozambique.
BII is committing through Lendable’s existing senior secured facility, leveraging the partner’s expertise in fintech debt investing across Africa as well as their investment monitoring capabilities.
Chris Chijiutomi, managing director and head of Africa, BII said, “Sending money to Africa is expensive. That is why our investment in TerraPay is critical to help increase availability of lower-cost, efficient, accessible and reliable remittances. This aligns with our goal to support resilient financing and improve economic opportunities on the continent.”
Stay ahead in Africa's private equity and venture capital sector with Africa Private Equity News’ monthly Dealmaker’s Log – a database of reported investment deals, exits, and fundraising closes. Subscribe here