Kuda Bank has been something of an understated achiever in the tech space since it kicked off operations in 2018. The two-year-old start-up has targeted a market niche that most fintech start-ups do not venture into, for whatever reason and it has been gaining hot momentum since last year.
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Only this Monday, Techcrunch reported that Kuda Bank has secured $10m in Series A funding and in doing that has become Nigeria’s first truly all-digital bank. The bank had only just last year, secured $1.6m in pre-series funding from angel investors Haresh Aswani of Tolarams Group and Ragnar Meitern and since then the bank has managed to come into the public consciousness to a decent level at least. The latest funding round was only the largest ever in Nigeria’s tech space according to Techcrunch. The round was led by Target Global, Entrée Capital and SBI Investments.
Kuda Bank launched in 2018 and was founded by Babatunde Ogundeyi, financial advisor and government consultant and Musty Mustapha, who previously worked Stanbic’s IT unit and now doubles as co-founder and CTO at Kuda Bank. The company began as an e-wallet under the name Kudimoney. That name changed to Kuda Bank and they eventually pivoted to becoming a real bank. Only this time, they operated fully online. Kuda secured its full banking license last year from the Central Bank thanks to its re-seed funding and we already explained, have gone through two funding rounds.
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The growing discontent and distrust of Nigerian customers in brick and mortar banks has seen many consider all-digital alternatives like Kuda Bank and VBank which only just launched this year. Indeed, the founder and CEO of Kuda Bank, Babatunde Ogundeyi has stated that discontent was the very reason for the pivot to full banking for his company, Kuda Bank partners with Nigeria’s big three banks, GTBank, Access Bank and Zenith Bank to provide some physical infrastructure for its business. In other words, most of the physical aspects of its operations are outsourced to brick and mortar banks. All of the banking happens from your phone as a customer on an app that Mr Ogundeyi claims was purpose-built from the ground up.
$10m is a new high and many others can now dream of scaling and even beating those heights. So while 2020 would not count as a great year for many of us, the tech space has had big wins this year from Paystack to Interswitch to KudaBank. We can actually look forward to more wins in the new year as this one comes to a close.
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