IFC Pours R225M into Adumo to Boost African SME Payments

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The International Finance Corp. (a division of the World Bank) continues to pour funds into tech businesses addressing Africa’s small business market.


Last week, we learned the IFC has invested R225 million (about US$!5 million) in the South African fintech Adumo


The IFC says the investment is motivated by the need to accelerate access to digital payments in Africa, in particular by small businesses.


Here is what Adumo CEO Paul Kent said about the investment.


“The pandemic and associated impact on consumers and businesses are transforming the face of the payments industry, with interest in cashless payment services at an all-time high. The funds we have raised from our new equity partners will help us roll out new payment innovations and purpose-based lending services to support consumers and retailers as they navigate an uncertain 2021.”


Sérgio Pimenta, the IFC’s VP for the Middle East and Africa region, emphasized the importance of helping SMEs in the current climate.


“Through this investment in Adumo, we will be helping small businesses tap into the digital economy, which is more important now than ever before. Digital payments are often the first step for a small business to build a credit history, which opens the way to access further financial services such as financing to grow the business.”


Sandton-based Adumo, founded in 2018, owns two other South African fintechs, SureSwipe and PanAfrican Payments, plus it owns a “major stake” in Durban-based point of sale player Ikhokha.


Here is what Ikhokha CEO Matt Putnam said about the investment’s significance.


“The investment from IFC into the group demonstrates further high profile international investor appetite to participate and scale the South African fintech story which is extremely positive for local consumers and the SME ecosystem.”


Last June, what was Crossfin Transactional Solutions rebranded as Adumo in order to, as the company stated, "infuse the fast-growing fintech company with an authentic African feel that speaks to its existing and future customer base."


Helping Bolt Break Out in Africa

Last week we learned that the IFC also recently invested US$24 million in the Estonian ride-hailing service Bolt. The investment was designed to support Bolt’s expansion in Africa and other developing markets. Bolt already operates in four African cities, Johannesburg, Nairobi, Accra, and Dar es Salaam.


The investment comes with the intent to “disrupt the transport sector in a way that is good for the environment, creates more flexible work opportunities for women, and provides safer and more affordable transportation access in emerging markets” says Stephanie von Friedeburg, COO of the International Finance Corporation.


The app has a very diverse user base, featuring 50 million users in over 40 different countries, mainly in Africa and Eastern Europe.


In 2020, Bolt raised 100 million Euros (~$120 M) from London-based Naya Capital Management, and secured 50 million euros in debt financing from the European Investment Bank, valuing the company at 1.7 billion Euros (~$2.02 B)


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