Africa is seeing rapid expansion in the gig economy. Despite this expansion, the status of workers who are considered contractors rather than employees has remained unchanged. Being a contractor is unfavorable for many of them, particularly in the two-wheeler industry, because they lack access to various financial services. Some gig platforms have attempted to incorporate financial services onto their platforms, however their capabilities are limited.
Other fintechs, meanwhile, are offering a larger range of financial services to these gig workers (who, according to the Mastercard Foundation, are expected to reach over 80 million by 2030). ImaliPay is a good illustration of this. The startup, which bills itself as a “one-stop shop” for financial services, has raised $3 million in a seed loan and equity round. In 2020, the fintech raised an $800,000 pre-seed investment. It was founded by Tatenda Furusa and Oluwasanmi Akinmusire in late 2020 after Furusa witnessed the difficulties ride-hailing drivers had in obtaining working funds or dealing with situations such as running out of gasoline in Nairobi.
When asked how the firm was started, CEO Furusa told TechCrunch on a teleconference, “a couple of things related to this point.” “When I was traveling from the airport in Nairobi, a Bolt driver ran out of petrol and couldn’t fill up right away. “It got me thinking about what additional hardships these gig workers could be going through,” he added. “We looked into the gig economy and discovered that it was being overlooked by several banking institutions.” And we realized we were in a great position to establish a fintech that would solve the concerns of Africa’s gig economy, freelancers, and self-employed digital workers.”
ImaliPay’s pilot was inspired by Furusa’s experience: a buy now, pay later (BNPL) gasoline product for two-wheeler gig platforms, with the firm partnering with a few fuel stations in Ibadan, Nigeria, to provide this service to SafeBoda riders. The business then went on to build a partner ecosystem in which some partners provide access to new consumers while others maintain the ecosystem and marketplace.
“Around replacement parts, cellphones, power banks, savings and investments, and insurance combined with those things, we built out other services,” Furusa added. “So, similar to accident insurance and income protection loss insurance, we’ve combined these products so that gig workers may qualify for each depending on their transactional behavior.”
The former is largely the fault of the gig platforms. Bolt, Glovo, SWVL, Amitruck, Safeboda, Gokada, and Max.ng are among the 15 partners in this category. Vendors who deal with gasoline, spare parts, mobile phones, and other products needed by gig workers make up the difference. ImaliPay has collaborated with platforms in Kenya and South Africa to provide additional financial services such as insurance (health and income protection loss) and savings through various gig platforms.
Lami, Cowrywise, Ola Energy, Total Energies, HiFi Corporation, and Britam are among the 35 companies represented. It connects its APIs to partner firms or provides these financial services directly to gig workers in this network via an independent app, chatbot, or USSD. ImaliPay’s user base has increased by 60 times in just 15 months. These “tens of thousands” of gig workers use the firm’s services through 4,500 vendor points, according to the corporation. On ImaliPay’s platform, over 200,000 transactions have been completed. Transaction and referral fees are how the pan-African integrated financing provider makes money.
Before founding ImaliPay, COO Akinmusire and Furusa met while working at Cellulant. They got money from the Google Black Founders Fund in October of last year before closing this seed round, which included Leonnis Investments. Ten 13, Uncovered Fund, MyAsia VC, Jedar Capital, Logos Ventures, Plug N Play Ventures, Untapped Global, Latam Ventures, Cliff Angels, Chandaria Capital, and Changecom were among the follow-on investors in the round. Keisuke Honda of KSK Angels, as well as other angel investors from Serbia, Kenya, and Norway, took part. The funds will be used to grow the company’s 50-person workforce, improve its technology, and expand into other areas such as Ghana and Egypt, according to the founders.