Bogota, Colombia API-based payments fintech Minka plans to use some of the $24 million it raised back in April from Tiger Global and other investors to expand into Africa. The company has raised $27.5 million since its 2018 founding.
Minka is a cloud-based open banking platform built on blockchain technology. The company’s leaders say similarities in the fintech challenges facing Latin America and Africa are driving the decision to enter the continent.
“The flexibility of this solution is one of the great benefits we can bring to the African market,” said Minka co-founder and Head of BiZops Paola Sánchez.
“Our (API) based technology is completely agnostic to the use cases that are needed in a region, which allows us to build a platform for any type of payment exchange, in both the public and private sectors, in a matter of weeks or months as opposed to years.”
Minka is banking on the similarities in the two emerging markets being similar enough to replicate the success the company is having in Latin America. It points to the LatAm region’s largest open-banking project, TransfiYa, which it launched in 2020 in partnership with ACH Colombia. Minka says that the project is being used by 2 million Colombians to send money using only a mobile phone number.
One thing that makes TransfiYa unique is that it’s a fully private system. Other instant transfer projects in the region were done in partnership with central banks and regulators.
“We intend to replicate this success in markets across the world including Africa, which has leapfrogged into the fintech space and has similar demographics and levels of financial exclusion of those in Latin America,” Sánchez said.
In Colombia, roughly 30% of the adult population either doesn’t have or doesn’t use a bank account. More than 85% of transactions are made in cash.
A recent study from the fintech BPC found that 57% of Africans do not have a bank account.
Minka has not yet specified which markets it will target first in Africa, or what partnerships it will pursue to accelerate its market entry.